Affiliation:
1. ADANA ALPARSLAN TÜRKEŞ BİLİM VE TEKNOLOJİ ÜNİVERSİTESİ
Abstract
Cash is of great importance to firms operating in emerging economies. Cash, one of the most important assets, creates shareholder value when rationally used by firm management. This paper aims to reveal the relationship between financial performance and cash holdings by using a sample that consists of non-financial firms listed in Borsa Istanbul 50 index. The result of empirical analysis provides strong evidence that financial performance is positively influenced by cash holdings. Further, firm size, capital intensity ratio and current ratio did not significantly influence the financial performance of sample firms, while financial performance of sample firms is significantly influenced sales growth and financial leverage. Overall, the research findings indicate that firm-specific factors are important factors that affect the relationship between financial performance and cash holdings. The present paper provides important insights for creditors, shareholders and firm management on the impacts of cash holding levels on financial performance.
Publisher
MANAS Sosyal Arastirmalar Dergisi
Reference38 articles.
1. Abushammala, S. N., & Sulaiman, J. (2014). Cash holdings and corporate profitability: Some evidences form
Jordan. International Journal of Innovation and Applied Studies, 8(3), 898-907.
2. Alnori, F. (2020). Cash holdings: Do they boost or hurt firms’ performance? Evidence from listed non-financial
firms in Saudi Arabia. International Journal of Islamic and Middle Eastern Finance and Management, 13(5),
919-934.
3. Alnori, F., & Bugshan, A. (2023). Cash holdings and firm performance: empirical analysis from Shariah-
compliant and conventional corporations. International Journal of Islamic and Middle Eastern Finance and
Management, 16(3), 498-515.
4. Baltagi, B. H. (Ed.). (2006). Panel data econometrics: Theoretical contributions and empirical applications.
Emerald Group Publishing.
5. Bates, T. W., Kahle, K. M., & Stulz, R. M. (2009). Why do US firms hold so much more cash than they used to?.
The Journal of Finance, 64(5), 1985-2021.