{"id":28232,"date":"2026-08-13T07:30:00","date_gmt":"2026-08-13T11:30:00","guid":{"rendered":"https:\/\/jeffclarktrader.com\/market-minute\/?p=28232"},"modified":"2026-08-12T13:25:40","modified_gmt":"2026-08-12T17:25:40","slug":"heres-how-to-find-stocks-offering-double-digit-cash-flow-yields","status":"publish","type":"post","link":"https:\/\/jeffclarktrader.com\/market-minute\/heres-how-to-find-stocks-offering-double-digit-cash-flow-yields\/","title":{"rendered":"Here\u2019s How to Find Stocks Offering Double-Digit Cash Flow Yields"},"content":{"rendered":"
\n

Managing Editor’s Note:<\/strong> Today, we’re hearing from our contributing editor Mike Burnick in his weekly feature.<\/p>\n

Mike has over 30 years in the investment and financial services industry – from operating as a stockbroker, trader, and research analyst, to running a mutual fund as a registered investment advisor and portfolio manager, to being Research Director for the Sovereign Society, specializing in global ETF and options investing.<\/p>\n

 And he’s been senior analyst at TradeSmith for three years, running Constant Cash Flow, Infinite Income Loop, and Inside TradeSmith.<\/p>\n

Here’s Mike…<\/p>\n<\/div>\n

Here’s How to Find Stocks Offering Double-Digit Cash Flow Yields<\/h2>\n

BY MIKE BURNICK, CONTRIBUTING EDITOR, MARKET MINUTE <\/em><\/strong><\/p>\n

Earnings season is just about done with over 450 of the S&P 500 reporting already.<\/p>\n

A key reveal this earnings season was a lack of enthusiasm for positive earnings surprises, due mainly to over-inflated profits.<\/p>\n

What’s more telling, stocks that fell short of sales estimates got hammered. Even when they beat earnings forecasts, stocks dropped 3% the day after reporting.<\/p>\n

Investors are paying more attention to the quality of earnings, and that quality is deteriorating. Stocks with positive free-cash-flow growth are rewarded, while those with declining cash flow get punished, even when they beat earnings estimates.<\/p>\n

Free cash flow (FCF) is simply a company’s operating cash flow, minus capital expenses. And it’s the best way to find quality stocks that aren’t inflating earnings.<\/p>\n

Case in point, two Magnificent 7 stocks, Google parent Alphabet (GOOGL) and Amazon (AMZN), both reported low-quality earnings and got whacked.<\/p>\n

Two-thirds of Alphabet’s net income was due to “paper gains” on investments in Anthropic and SpaceX. Plus, its free cash flow went negative for the first time ever!<\/p>\n

Amazon also booked big paper gains of $53 billion last quarter, and posted negative free cash flow for the last two quarters.<\/p>\n

Take FCF per share and divide by a company’s enterprise value (stock market cap + debt) and you’ve got the free cash flow yield.<\/p>\n

Just like a stock’s dividend yield, a higher FCF yield indicates a quality stock that may be undervalued relative to the cash it generates.<\/p>\n

The average stock in the S&P 500 has a FCF yield of just 2.5% today.<\/p>\n

But by using our TradeSmith Screener, I found 80 nonfinancial stocks in the S&P 500 with FCF yields above 5%, or twice<\/u><\/em> the S&P 500 average – 21 with double-digit<\/em> yields!<\/p>\n

Subscribers can use our Screener tool to quickly find them. Simply log into TradeSmith Finance, and from the main menu bar, click Invest<\/em><\/strong> and then Screener<\/em><\/strong> in the sub-menu.<\/p>\n\n

\"\"<\/figure>\n\n

Next, start a new screener by clicking on + Add Filter<\/em><\/strong>, then insert a few simple filters, as shown above.<\/p>\n

The filters are:<\/p>\n

    \n
  • Markets<\/em> > add S&P 500 Index<\/em><\/strong><\/li>\n
  • Dividends, Cash Flow & Ownership<\/em> > add Free Cash Flow Yield<\/em><\/strong>, set at more than 5%<\/em><\/strong><\/li>\n<\/ul>\n

    This screener will find stocks in the S&P 500 with a FCF yield at least twice<\/u><\/em> the S&P 500 average.<\/p>\n

    When I ran my screen with these filters, I got 80 results, many of them healthcare, industrial, and energy stocks.<\/p>\n

    The top 10 shown below are sorted by the FCF Yield column, with the highest at the top.<\/p>\n\n

    \"\"<\/figure>\n\n

    Bottom line<\/em><\/strong>: Cash is king when earnings are inflated by paper gains. Free cash flow is the best single measure of a stock’s quality in my book. And you can use our popular TradeSmith Screener to find stocks with strong free cash flow and the potential to beat the market.<\/p>\n

    Good investing,<\/p>\n

    \"Signature\"<\/p>\n

    Mike Burnick
    \nContributing Editor, Market Minute<\/em><\/p> \n\n\n","protected":false},"excerpt":{"rendered":"

    Use our TradeSmith Screener to find stocks with the potential to beat the market.<\/p>\n","protected":false},"author":2762,"featured_media":0,"comment_status":"closed","ping_status":"0","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"ep_exclude_from_search":false,"service":"","footnotes":""},"categories":[1],"tags":[],"publication":[10],"person":[155],"newsletter-type":[],"ticker":[],"class_list":["post-28232","post","type-post","status-publish","format-standard","hentry","category-market-minute","publication-market-minute","person-mike-burnick"],"acf":[],"ai_tts_audio_outdated":false,"ai_tts_content_changed_at":"","ai_tts_content_changed_during_generation":false,"ai_tts_legacy_post":false,"_links":{"self":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/28232","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/users\/2762"}],"replies":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/comments?post=28232"}],"version-history":[{"count":1,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/28232\/revisions"}],"predecessor-version":[{"id":28238,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/28232\/revisions\/28238"}],"wp:attachment":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/media?parent=28232"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/categories?post=28232"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/tags?post=28232"},{"taxonomy":"publication","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/publication?post=28232"},{"taxonomy":"person","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/person?post=28232"},{"taxonomy":"newsletter-type","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/newsletter-type?post=28232"},{"taxonomy":"ticker","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/ticker?post=28232"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}