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Cash flow growth is arguably one of the most important considerations in the financial analysis of a company. While earnings and net worth are subject to management estimates, cash flow is very difficult to alter.

We ran a screen on large-cap stocks for those that have seen high cash-flow growth over the last 5 years, with trailing-twelve-month operating cash flow/common equity at least 20% higher than the company’s 5-year average ratio. From this universe, we then searched for companies seeing significant net institutional buying over the current quarter.

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the top six stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.


We also created a price-weighted index of the stocks mentioned below, and monitored the performance of the list relative to the S&P 500 index over the last month. To access a complete analysis of this list's recent performance, click here.

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Do you think these companies are generating enough cash? Use this list as a starting-off point for your own analysis.List sorted by net institutional purchases as a percent of share float.

1. Central Pacific Financial Corp. (CPF): Regional Banks Industry. Market cap of $565.99M. TTM operating cash flow/common equity at 0.86 vs. 5-year average at 0.34. Net institutional purchases over the current quarter at 14.4M, which is 64.98% of the company's share float. The stock has lost 55.69% over the last year.

2. Optimer Pharmaceuticals, Inc. (OPTR): Biotechnology Industry. Market cap of $543.22M. TTM operating cash flow/common equity at 0.15 vs. 5-year average at -2.18. Net institutional purchases over the current quarter at 5.2M, which is 12.37% of the company's share float. The stock is a short squeeze candidate, with a short float at 11.35% (equivalent to 6.21 days of average volume). The stock has gained 26.02% over the last year.

3. Entercom Communications Corp. (ETM): Broadcasting Industry. Market cap of $329.47M. TTM operating cash flow/common equity at 0.63 vs. 5-year average at 0.22. Net institutional purchases over the current quarter at 1.9M, which is 9.95% of the company's share float. This is a risky stock that is significantly more volatile than the overall market (beta = 2.69). Might be undervalued at current levels, with a PEG ratio at 0.93, and P/FCF ratio at 4.09. The stock is a short squeeze candidate, with a short float at 12.9% (equivalent to 15.14 days of average volume). The stock has lost 8.53% over the last year.

4. Annaly Capital Management, Inc. (NLY): REIT Industry. Market cap of $14.68B. TTM operating cash flow/common equity at 1.27 vs. 5-year average at 0.80. Net institutional purchases over the current quarter at 68.1M, which is 8.42% of the company's share float. The stock has gained 14.1% over the last year.

5. VeriFone Systems, Inc (PAY): Business Equipment Industry. Market cap of $3.82B. TTM operating cash flow/common equity at 0.69 vs. 5-year average at 0.45. Net institutional purchases over the current quarter at 6.7M, which is 7.65% of the company's share float. The stock has gained 109.62% over the last year.

6. Nxstage Medical, Inc. (NXTM): Medical Appliances & Equipment Industry. Market cap of $1.11B. TTM operating cash flow/common equity at 0.01 vs. 5-year average at -0.33. Net institutional purchases over the current quarter at 1.1M, which is 2.70% of the company's share float. The stock is a short squeeze candidate, with a short float at 12.51% (equivalent to 10.21 days of average volume). The stock has gained 42.45% over the last year.

*Operating cash flow/common equity data sourced from Screener.co, institutional data sourced from Fidelity, all other data sourced from Finviz.

Source: 6 Large Caps With High Cash-Flow Growth Being Bought Up by Institutions