IDEAS home Printed from https://ideas.repec.org/a/rbq/journl/i132p53-62.html
   My bibliography  Save this article

Cash Holdings, Working Capital and Firm Value: Evidence from France

Author

Listed:
  • Ruta Autukaite

    (EDHEC Nice)

  • Eric Molay

    (Université de Nice Sophia-Antipolis)

Abstract

The importance of short-term financial decisions to a company’s value is considered in this paper by testing whether an extra euro invested in cash or in net working capital is valued at less than one euro. By running panel data regressions, the presented evidence proves that shareholders undervalue cash holdings and net working capital. The results of this paper alert management not to underestimate the importance of cash holdings and working capital management; moreover, the results encourage investors to follow a company’s actions in this area to maximise their returns on investment.

Suggested Citation

  • Ruta Autukaite & Eric Molay, 2014. "Cash Holdings, Working Capital and Firm Value: Evidence from France," Bankers, Markets & Investors, ESKA Publishing, issue 132, pages 53-62, September.
    • Handle: RePEc:rbq:journl:i:132:p:53-62
    as

    Download full text from publisher

    File URL: http://www.revue-banque.fr/article/cash-holdings-working-capital-and-firm-value
    Download Restriction: price
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Wetzel, Philipp & Hofmann, Erik, 2019. "Supply chain finance, financial constraints and corporate performance: An explorative network analysis and future research agenda," International Journal of Production Economics, Elsevier, vol. 216(C), pages 364-383.

    More about this item

    Keywords

    Cash Holdings; Profitability; Stock Return; Working Capital;
    All these keywords.

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:rbq:journl:i:132:p:53-62. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Marise Urbano (email available below). General contact details of provider: http://www.eska.fr/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.