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High free cash flow stocks: companies that turn sales into cash

Free cash flow is the cash left after a company has paid for running and investing in its business. It pays dividends, buybacks and debt - and it is harder to dress up than earnings.

By the Ticker Picker team

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Margin and price

The free cash flow margin is the share of sales that ends as free cash flow; 15 % or more is strong for most industries. The price to free cash flow says how many years of today's cash flow you pay for the company - lower is cheaper.

What to check

One strong year can come from delayed investment or a one-off. Look for free cash flow that has been positive and growing for several years, and compare it with the reported profit - large gaps deserve an explanation.

Using the screener

The profile below shows companies worth at least 2 billion with a free cash flow margin of at least 15 % and a price below 25 times their free cash flow, ranked by the margin.

Try it in the screener

The High free cash flow profile shows companies that turn sales into cash. It is a learning example, not a recommendation.

Show high free cash flow stocks

This content is general information, not investment advice.