Cash Flow is measure of a company's ability to grow internally, that is without borrowing money or going to the equity markets in a possibly dillutive (issuing more shares) approach to raise funds. This means that companies that generate substantial internal cash flow from continuing operations are in position to use the proceeds to shareholders' advantage.
Companies with a good cash flow can use the money for acquisitions, paying dividends, increasing research and development, upgrading plants and equipment, opening new stores, buying back stock, or paying off debts.