Core Viewpoint - The article emphasizes the growing importance of free cash flow (FCF) as a key indicator for assessing a company's intrinsic value, highlighting its role in classic value investment strategies and the increasing focus on companies with strong cash generation capabilities [3][4][14]. Summary by Sections Free Cash Flow Concept - Free cash flow is defined as the cash remaining after a company has paid all its operating expenses and capital expenditures, which can be used for debt repayment, dividends, or reinvestment, serving as a crucial indicator of a company's true profitability [4][6]. Investment Strategy - Focusing on high free cash flow companies can help investors avoid pitfalls and strive for long-term returns, as these companies demonstrate strong operational performance and lower financial manipulation compared to net profit [7][8]. - High free cash flow firms are better positioned to withstand economic downturns due to their solid financial foundations and can leverage their cash reserves for growth opportunities during economic upturns [8]. Performance of Free Cash Flow Strategy - The China Securities Index's Free Cash Flow Total Return Index has shown a remarkable increase of 754.11% since its base date of December 31, 2013, significantly outperforming the broader market index, which rose by 147.62% in the same period [9][12]. - The Free Cash Flow Total Return Index has consistently outperformed the broader index during market downturns and has had competitive performance during market upturns, indicating its effectiveness as an investment strategy [12][13]. Future Outlook - As the macroeconomic environment undergoes structural changes, the significance of free cash flow strategies is expected to increase, particularly as the economy shifts from high-speed growth to high-quality development, favoring companies with strong cash flow generation [14]. - The ongoing decline in interest rates is likely to drive market participants to seek assets that can generate sustainable cash flows, enhancing the investment appeal of companies with abundant free cash flow [15].