Convergex, an agency-focused global brokerage and trading related services provider, has released the results of its Corporate Cash Survey, quantifying financial industry sentiment about current elevated levels of corporate cash holdings. Conducted from February 10 to February 12, 2015, the results reveal an investment community that overwhelmingly believes large publicly owned U.S. corporations currently hold too much cash on their balance sheets.

Respondents to the survey emphatically say that companies are holding excess funds: nearly three-quarters (72%) said "too much cash" or "way too much cash" is currently on the books. Specific industries were singled out in the results, with the Technology sector definitively identified as the greatest offender. Seventy-three percent (73%) of investment professionals said technology companies are holding too much cash, followed by the Financial sector (43%) and Industrials (26%). 

Asked why corporations are reluctant to spend, financial professionals identified Economic Uncertainty (37%) as the top reason, followed by Regulatory Uncertainty (27%) and Uncertainty Over Central Bank Policy (10%). In a similar vein, investors said that they themselves have more wealth kept in cash than before the financial crisis, with almost half (49%) saying they hold "more" or "much more" now, compared with only sixteen percent (16%) who said "less" or "much less." 

"Despite these rationales, our survey shows that investors want corporate leaders to open up the checkbook," said Nicholas Colas, Convergex chief market strategist. "And while the loudest voices may be calling for return of capital to investors, our respondents were decidedly against the conventional wisdom, instead calling for spending aimed at growth. Almost two-thirds (61%) named Capital Expenditure, Incremental Hiring or Acquisitions as their preferred use of excess cash, while just thirty-nine percent (39%) chose Dividends or Buybacks." 

For more information on the Convergex Corporate Cash Survey, click here.

"Twenty Minute Talk"
Please join us for a fast-paced 20 minute conference call on the topic of Excess Corporate Cash, reviewing these survey results and providing additional insight, on Thursday, February 26, 8:00 a.m. ET. Dial-in information can be found here.

Too. Much. Cash.
Do you believe large publicly owned corporations are currently holding…

• Way Too Much Cash – 12% 
• Too Much Cash – 60% 
• Right Amount of Cash – 20% 
• Too Little Cash – 7% 
• Way Too Little Cash – 1%

Why So Serious?
If you believe U.S. corporations are holding too much cash, what do you believe is the single most important reason why?

• Economic Uncertainty – 37% 
• Regulatory Uncertainty – 27% 
• Lack of Investment Opportunities – 26% 
• Uncertainty Over Central Bank Policy – 10% 

Tagging Technology
In which sectors are companies holding too much cash? (Select all that apply)

• Technology – 73% 
• Financials – 43% 
• Industrials – 26% 
• Health Care – 24% 
• Consumer Staples – 18% 
• Energy – 16% 
• None – 5%

Going For Growth
If you believe a large U.S. corporation is holding too much cash, how would you prefer they use it?

• Capital Expenditure – 35% 
• Initiate or Increase Dividends – 24% 
• Incremental Hiring – 16% 
• Stock Buybacks – 15% 
• Acquisitions – 10%

Do As I Say, Not As I Do?
Do you personally hold more or less cash than you did before the financial crisis?

• Much More Cash – 8% 
• More Cash – 41% 
• Same Amount – 35% 
• Less Cash – 13% 
• Much Less Cash – 3%