The companies in the low-volatility funds he chooses for his clients tend to be "cash-flow rich with low price/earnings ratios, dividend paying with a value tilt," Mr. Gunkel said.
While the growth of a European consumer is good news for Europe and Europe Cap App, the best news is in the cash-flow rich Nordic companies which, contrary to popular belief, also present a diversified portfolio.
It has since filled out its portfolio with acquisitions and investment across the globe, matching businesses in fast-growing regions like China and Latin America with mature, cash-flow-rich areas like Europe and the United States.
Both sides covet Cegetel's SFR wireless subsidiary for its fast growth and rich cash flow.
The controversial business model and rich cash flow make it easy for Wall Street to keep imprinting fresh narratives on the company.
In a report released earlier this month, Dresdner Kleinwort Wasserstein, an investment bank, argued that Schering's underperforming research pipeline and poor cost-cutting record, made the company vulnerable to acquisition by a private-equity firm eyeing its rich cash flow.
Threlfall thinks Lockheed deserves a high price/earnings ratio based on its rich cash flow, and believes the stock could hit $180 a share within the next 12 months.
Fyhr argues that like the oil drillers in the mid-1990s, marine shippers will fetch richer cash flow multiples than they have historically, especially as more U.S. investors take an interest in the industry.
A net valuation of $4 billion would put the multiple for the network, which is the bulk of the company's value, at 23 times cash flow, which would make it a rich deal, according to Mr. Gerbrandt.
The home builders are dead through 2007, while newspaper empires and broadcasting franchises are far from moribund but still too rich on free cash flow valuations.
Finally though by 2011 Microsoft may seem as outmoded as Xerox does now Pabrai optimistically projects it will be trading at a rich 15 times cash flow, giving it a $204 billion market capitalization.
