Had Jerry Maguire been an investor instead of a fictional sports agent, he might have become famous for yelling, "Show me the cash flow!"

Earnings come and go, and the green-eyeshade types can legally manipulate it to mask a company's true operations. Yet its ability to generate cash -- what comes in the register and goes out the door -- remains the preeminent indicator of company's worth. In short, cash is king.

Below, we'll look at companies that have proven themselves prodigious generators of free cash flow (FCF) -- the amount of money a company has left over that it could potentially pay to its investors. We'll find companies that have generated compounded free cash flow growth rates exceeding 25% annually over the past five years, then pair them with the opinions of the more than 140,000 members of the Motley Fool CAPS investor intelligence community, to see which ones might have the best chance of outperforming the market.


Levered FCF
5-Year CAGR, %

CAPS Rating 
(out of 5)

American Capital (NASDAQ:ACAS)






Harley-Davidson (NYSE:HOG)



Priceline.com (NASDAQ:PCLN)






Source: Capital IQ, a division of Standard & Poor's; Motley Fool CAPS.
CAGR=compounded annual growth rate.

Generating copious amounts of cash doesn't make a company an automatic buy. But having looked at Enron's cash flows instead of its earnings would have saved many investors a lot of grief. Warren Buffett understands that the value of a company today is calculated by its discounted future cash flows, so use this list as a jumping-off point to dig deeper into the piles of cash.

Can we finally put a fork in Apple's naysayers? If nothing else, the iconic company's earnings yesterday finally put to rest the lie that its premium products would suffer as a result of the recession.

Sales of iPhones, iPods, and Macs were all better than anticipated. The 3GS iPhone had its first full quarter of sales. (It was released in late June for all you non-Apple-obsessed types.) Apple pushed 7.4 million devices out the door, compared to the 7 million that Wall Street had been expecting, while it sold more than 3 million Macs. The back-to-school season helped to push Mac sales 17% higher, including the one I purchased when packing my daughter off to college. While iPod shipments were off 8% from the year-ago quarter, sales of 10.2 million units still exceeded analyst estimates.

Apple's rivals do little to quell the notion that they're easily capable of bringing to market the next "i-whatever killer." The strength of Apple's performance this quarter, though, is going to step up the pressure on Research in Motion (NASDAQ:RIMM) and Palm (NASDAQ:PALM) to show that their offerings can similarly connect with the consumer. Garmin's released-at-last nuviphone still has a long way to prove itself, while Google (NASDAQ:GOOG) needs to deliver on its promise that Android will be as big as it says. And Microsoft is releasing what tomorrow? Right now, I'm betting people are more interested in Apple's new operating system, Snow Leopard, than Windows 7.

As CAPS member DarthMaul09 notes, Apple still has other levers to pull to justify the premium the market is assigning to its shares:

Fortunately I bought this stock when Jobs was ill and irrational pessimism about this company's future crushed its stock price. With the iPhone dominating here, soon to be in China, the iPod, iTouch, new Macs, and iToons this company looks to be on the verge of having a MS type of stock splits every 6 months.

Follow the money
What's your view? While these stocks have left a trail of dollars, it pays to start your own research on Motley Fool CAPS. Read a company's financial reports, scrutinize key data and charts, and examine the comments your fellow investors have made all from a stock's CAPS page. Why not head over to the completely free CAPS service and let us hear what you've got to say about these, or any other stocks that you think will continue to be rolling in the dough.

Apple and Priceline.com are Motley Fool Stock Advisor recommendations. Google is a Rule Breakers pick. Microsoft is an Inside Value recommendation. Garmin is a Global Gains recommendation. Try any of our Foolish newsletter services today, free for 30 days.

Fool contributor Rich Duprey does not have a financial position in any of the stocks mentioned in this article. You can see his holdings here. The Motley Fool has a disclosure policy.