Strong cash flows reflect financial stability, allowing companies to pay down debt, pursue growth opportunities, and shell out dividend payments.
These companies are also better equipped to weather downturns, providing another beneficial advantage for investors from a long-term standpoint.
And for those seeking cash-generating machines, two mega-cap tech giants – Microsoft MSFT & Apple AAPL – fit the criteria nicely. Let’s take a closer look at how each currently stacks up.
Apple Breaks Records
Apple shares have jumped off 2025 lows, up 10% YTD but underperforming relative to the S&P 500. Its latest set of quarterly results broke several records, including revenue, EPS, and iPhone revenue for its September period.
Below is a chart illustrating the company’s quarterly sales.
Image Source: Zacks Investment Research
The company has long been a cash-generating machine, providing many benefits over the years, including higher dividend payouts. In fact, Apple has paid higher dividends for 13 consecutive years, owing to its shareholder-friendly nature.
Shares yield a modest 0.4% annually, though the company’s 5.0% five-year annualized dividend growth helps bridge the gap. On a trailing twelve-month basis, the tech titan has generated a massive $98.8 billion in free cash flow.
Microsoft Sees Big Growth
Microsoft shares have been strong in 2025 so far, up 21% compared to the S&P 500’s 19% gain. Concerning headline figures in its latest release, EPS of $4.13 and sales of $77.7 billion both handily exceeded our consensus expectations, continuing its recent streak of better-than-expected results. Sales grew an impressive 18% year-over-year, whereas EPS climbed 25%.
Below is a chart illustrating MSFT’s sales on a quarterly basis.
Image Source: Zacks Investment Research
Like AAPL, strong cash flows have bolstered its shareholder-friendly nature, with Microsoft sporting a 10% five-year annualized dividend growth rate and generating $78.0 billion in free cash flow over the trailing twelve months.
Bottom Line
Companies with strong cash-generating abilities are great targets, as they have plenty of cash to fuel growth, pay out dividends, and easily wipe out debt. And as mentioned above, these companies are better equipped to handle an economic downturn, undeniably a positive.
For those seeking cash-generators, both tech titans above – Microsoft MSFT and Apple AAPL – fit the criteria nicely.
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This article originally published on Zacks Investment Research (zacks.com).