Market capitalization = share price × shares outstanding
Market capitalization
Market capitalization = share price × shares outstanding
Market capitalization represents the total market value of a publicly traded company's shares. It is calculated by multiplying the current market price of one share by the total number of outstanding shares. This metric provides investors with an understanding of the company's market value.
Example
If a company's share price is $50 and it has 2 million outstanding shares, its market capitalization would be $100 million ($50 × 2,000,000).
Market capitalization helps investors assess the size and value of a company in the stock market.
Related concepts
Stock
A single share represents fractional ownership of a company
Earnings per share
Earnings per share (EPS) = Net income / Shares outstanding
Dividend yield
Dividend yield = Annual dividend / Share price
Stock split
Stock split doubles shares, halves price
Beta (finance)
Beta measures a stock's volatility relative to the market
Color depth
Market depth measures buy/sell volume at each price level
Educational content, not financial advice.
One email a day: 5 concepts + the 5 stories that matter →
Swipe through 100 ML concepts daily
Open TickerNews