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 pre-eminent 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 150,000 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)

Crocs (Nasdaq: CROX)



NYSE Euronext (NYSE: NYX)



Sherwin-Williams (NYSE: SHW)



Simon Property Group (NYSE: SPG)



Walgreen (NYSE: WAG)



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.

Cassandra's on the line
Wasn't it supposed to be a nuclear winter for commercial real estate by now? I know I've been one of a number of doomsayers warning the other shoe was going to fall, crushing the likes of Simon Property Group and Vornado Realty Trust (NYSE: VNO). Instead, Simon has actually managed to initiate what may become a bidding war for bankrupt General Growth Properties with its low-ball offer for the mall operator. Indeed, two very smart value investors, Bruce Berkowitz at Fairholme Capital Management, and Bill Ackman at Pershing Square Capital Management, have agreed to invest another $4 billion in General.

Well, Cassandra here still says the CRE market is going down. The Fed beige book released last week still showed the market deteriorating, and some analysts estimate there's at least $300 billion to$400 billion in CRE losses that have yet to be written down. I'm not alone, as CAPS member Chemdawg also expects Simon to "run out of steam," while 60% of the CAPS community members weighing in on the stock believe it will underperform the broad market averages.

Kickin' it to where?
Crocs is another name defying the critics, posting improved results for several quarters in a row, which has allowed it to laugh at Wall Street. But even if it becomes profitable this quarter (well, break-even anyway) as it predicts, there seems little impetus for it to resume its previous growth momentum. CAPS member shiko250 is expecting it to make another trip to penny stock territory:

Crocs is trying to diversify their product line but it appears the only way this stock has run up is on pure cost cutting. The Crocs fad seems to be over and they are so reliant on the middle income American consumer that it's hard to see this company doing well with unemployment hovering around 10 percent. I would cover this trade at $8.05. Short term I think this stock quickly gets below $7. Long term I think it retreats back to its 52 week low of $1.

Brush up on these stocks
The dips in commercial real estate, let alone the residential market, have taken a toll on Sherwin-Williams. Painting contractors have less business these days, but it remains an unbelievably solid company that's raised its dividend for the 31st consecutive year. Almost 90% of the CAPS members rating the paint maker agree that this company will outperform the market.

If investors continue to remain buoyant, it's likely that stock exchange operator NYSE Euronext will continue to generate cash based on rising volumes. CAPS member FitzColinGerald thinks its diversified offerings of stocks, exchange-traded funds, derivatives, options, futures, and bonds makes it a winner.

If that turns out not to be true, investors can get their fill of aspirin at drugstore chain Walgreen, which is getting even bigger as a result of its pending acquisition of Duane Reed. It has mixed store resets and targeted cost reductions of $1 billion by 2011 to ensure it will maintain double-digit growth projections. It faces stiff competition from CVS Caremark (NYSE: CVS), but 94% of CAPS members who logged an opinion on Walgreen see better times ahead, and bowlerboy5473 looks for it to fly under the radar, allowing for stealthy growth.

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've got to say about these or any other stocks that you think will continue to roll in the dough.

NYSE Euronext is a Motley Fool Rule Breakers pick. Sherwin-Williams is a Motley Fool Stock Advisor choice. 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. The Motley Fool has a disclosure policy.