Corporate cash holdings and firm performance: the role of family onwership and analyst coverage in Thai listed firms

Abstract

This study examines the determinants of corporate cash holdings and their implications for firm performance among non-financial firms listed on the Stock Exchange of Thailand over the period 2017 to 2024, with particular attention to the roles of family ownership and analyst coverage.The findings show that firm-specific characteristics drive cash holdings in directions broadly consistent with prior literature, although return on assets and net working capital exhibit signs specific to the Thai context. Family ownership has no significant effect on the level of cash holdings, providing no support for the entrenchment hypothesis. In contrast, analyst coverage significantly reduces cash holdings, consistent with its role as an external monitoring mechanism. Cash holdings are positively associated with firm value, but no inverted U-shaped relationship is found. Family ownership does not significantly moderate the cash-performance relationship when considered in isolation, and the interaction becomes positive and significant only in the full model when analyst coverage is simultaneously controlled for, suggesting that this result should be interpreted with caution as it reflects weak rather than strong evidence of moderation.These results provide some evidence that in an emerging market characterised by concentrated family ownership, internal family stewardship and external analyst monitoring may function as complementary governance channels that shape both the level of corporate cash holdings and the value investors assign to them.