A Trio of Stocks Growing Free Cash Flow Fast

These businesses show solid potential for additional growth

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Alberto Abaterusso
Feb 02, 2021
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If you are looking for investment opportunities amid U.S.-listed equities, you may want to have a look at the following stocks as they have grown their free cash flow (FCF) remarkably over recent years. This should allow them more flexibility for financing the development of projects and returning cash to shareholders. Wall Street is also quite positive about the three stocks listed below, as sell-side analysts have issued optimistic ratings for them.

Chemed Corp

The first company investors should have a look at is Chemed Corp (

CHE, Financial), a Cincinnati, Ohio-based company that provides hospice and palliative care services to U.S. patients through a network of physicians and other professionals.

The below table illustrates that the free cash flow per share has grown by 73.7% over the last 12 months, by 29% per year over the last five years and by 10.60% per year over the last 10 years.

The company is expected to increase earnings over the next five years at a 10.10% average growth rate per annum.

On Wall Street, as of February, the stock has a median recommendation rating of buy with an average target price of $601.67, marking a 16% upside from Monday's closing price of $519 per share.

The share price has gained 10% over the past year through Monday, determining a market capitalization of $8.28 billion, a trailing 12-month dividend yield of 0.25% (based on a quarterly cash dividend of 34 cents last paid on Dec. 7, 2020) and a 52-week range of $330.01 to $560.

Progress Software Corp

The second company investors should consider is Progress Software Corp (

PRGS, Financial), a Bedford, Massachusetts-based developer of application software for businesses.

The below table shows that the free cash flow per share increased 11.10% over the last 12 months and 10.60% per year over the last five years.

Looking ahead, analysts estimate earnings per share will grow by 5.2% to $3.25 in 2021 and by 4.60% to $3.40 in 2022. Earnings are expected to grow by 10% on average every year over the next five years.

On Wall Street, as of February, the stock has a median recommendation rating of buy with an average target price of $55.33, reflecting a 37% upside from the share price of $40.39 the market made at close on Monday.

The share price has declined 11.41% over the past year through Monday for a market capitalization of $1.79 billion, a forward dividend yield of 1.72% (based on a quarterly cash dividend of 17.5 cents to be issued on March 15) and a 52-week range of $28.09 to $49.23.

Johnson Outdoors Inc

The third company investors should have a look at is Johnson Outdoors Inc (

JOUT, Financial), a Racine, Wisconsin-based designer, manufacturer and marketer of camping, diving, watercraft and marine electronics products.

The below table exhibits that the free cash flow per share has grown by 57.20% over the last 12 months, by 28.30% per year over the last five years and by 12.20% per year over the last 10 years.

For the upcoming years, earnings per share are projected to increase by 11.9% to $6.12 in 2021 and by 14.40% to $7 in 2022. Over the next five years, the company has an expected annual average growth rate of 14%.

On Wall Street, as of February, the stock has one recommendation rating of buy with a target price of $140, representing a 25.8% upside from Monday's closing price of $111.25 per share.

The share price has climbed 48.57% over the past year through Monday, determining a market capitalization of $1.12 billion, a trailing 12-month dividend yield of 0.68% (based on a quarterly cash dividend of 21 cents last paid on Jan. 28) and a 52-week range of $48.76 to $121.50.

Disclosure: I have no positions in any security mentioned.

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I am a contributor at GuruFocus. I primarily write about how to pick potential value stocks. Gold, silver and precious metals mining industries is also my cup of tea. My articles have also been widely linked by popular sites, including MarketWatch, Financial Times, 24hGold, Investopedia, Financial.org, CNBS, MSN Money, Zachs, Reuters and others. I hold a Master\\\'s Degree in Business Administration from Università degli Studi di Bari (Italy), Aldo Moro. I am based in The Netherlands. You can follow me on Twitter at https://twitter.com/AAbaterusso