No, financial flexibility could be bad for shareholders. If managers have a lot of money lying around, they can often do as they please. They can build empires, avoid being fired if they make bad decisions (because the firm will not run into financial distress), and so on. Thus, financial flexibility is great for managers but not necessarily for shareholders, given the firm’s profitability. Of course, it is better for firms to have more cash rather than less, and there could also be some beneficial effects (e.g., distress avoidance).