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 the ability to generate cash -- what comes into the register and goes out the door -- remains the preeminent indicator of a company's worth. In short, cash is king.

Below, we'll look at companies that have proven to be prodigious generators of free cash flow (FCF) -- the amount of money a company has left over that it could pay to its investors. We'll find companies that generated growth rates for compounded free cash flow exceeding 25% annually over the past five years, then pair them with opinions from some of the 145,000 members of the Motley Fool CAPS community to see which ones might have the best chance of outperforming the market.


Levered FCF 5-Year CAGR

CAPS Rating
(out of 5)

Freeport McMoRan (NYSE:FCX)



Harley-Davidson (NYSE:HOG)



Oshkosh (NYSE:OSK)



priceline.com (NASDAQ:PCLN)



Seagate Technology (NYSE:STX)



Source: Capital IQ (a division of Standard & Poor's) and 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.

The voracious Chinese economy has powered demand for many commodities, with precious-minerals miner Freeport McMoRan being just one provider to benefit. So it shouldn't have been a surprise when China signaled it would tighten its monetary policy and the backlash hit commodities across the board.

Broadly, miners like BHP Billiton (NYSE:BHP) were handed a setback by China's moves. And with Alcoa (NYSE:AA) starting off the earnings season with a miss that reflects a still-weak outlook for the economy, the market has had little taste for the risk that these stocks bring.

Shares of Freeport McMoRan, which had nearly tripled in value over the past year, have fallen by more than 20% over the past few weeks. CAPS member Shaftsbury timed this bearish pitch on Freeport McMoRan almost perfectly, noting that despite the company's appeal, the peak price didn't justify the fundamentals:

I'm going against the flow here, realizing that momentum could carry this stock a higher. I've followed Freeport since it was a ten dollar stock wallowing in debt and have ... been greatly impressed by its substantial reserves and income potential. I've done very well with FCX over the years. Nevertheless, profit forecasts and copper price projections just don't seem to line up with the metrics and supply overhangs discussed by the company in recent years. How we have gone from oversupply prior to the 2008-2009 economic downturn to expectations of powerful demand and supply shortages any time in the next year or two is beyond me.

About 96% of the CAPS members rating Freeport McMoRan believe it will outperform the market. You can go to the company's CAPS page to make your case.

Follow the money
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 have to say about these or any other stocks that you think will continue to roll in the dough.

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