Market Capitalization

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SeekingAlpha  Mar 31  Comment 
By 3D Analytics: Introduction Shares of VAPE Holdings Inc. (OTCQB:VAPE) have risen from less than $1 per share to a high of $41.25 after the one-time social-network company changed its business operations to pursue opportunities in the...
SeekingAlpha  Mar 24  Comment 
By Power Hedge: North Atlantic Drilling (NADL) is one of the most highly levered offshore drilling companies, as evidenced by comparing its market cap to its enterprise value. At the time of writing, North Atlantic Drilling had a market cap of...
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The Economic Times  Mar 14  Comment 
IT cos will continue to produce excellent returns for the investors and at least TCS, HCL will definitely beat the NASSCOM growth targets.
The Economic Times  Mar 13  Comment 
Nifty may be trading at an all-time high with a market capitalisation, or m-cap, of $710 billion, but it still pales in comparison with the benchmark indices in the West.
SeekingAlpha  Feb 18  Comment 
Hickey and Walters (Bespoke) submit: The value of publicly-traded equities in the United States has increased by 35% over the past two years, and the US public market cap is now north of $22 trillion, or 139% of GDP. Global equity markets have...
The Hindu Business Line  Feb 2  Comment 
The overall market capitalisation of bourses worldwide crossed $64 trillion last year, the highest level in more than a decade, on the back of improving investor sentiment. The level tou...
WA Business News  Jan 29  Comment 
Large companies dominated the initial public offering market in 2013, with 96 per cent of all funds raised coming from companies with a market capitalisation of more than $100 million.
SeekingAlpha  Jan 23  Comment 
By Adam Gefvert: ServiceNow's (NOW) bread and butter service is IT Service Management (ITSM). Its ITSM product is so much better than the competition that NOW is acquiring new customers rapidly all over the world, many in the Global 2000...
The Economic Times  Jan 13  Comment 
Cheap valuations of several mid-cap stocks & stretched PE multiples of their larger peers are forcing investors to shift their focus to midcaps.




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Market Capitalization equals the price per share of a company times the number of shares outstanding

Market Capitalization, often shortened as "Market Cap", is the total market value of a company's outstanding shares. Market capitalization is calculated by multiplying the number of shares outstanding (this includes the value of all listed categories of a corporation's stocks - preferred stock, common shares, etc) by the market price per share which is the current value of a company. For example, if a company has 10 million shares, and the current price per share is $10, then the company's market capitalization is (10 million shares x $10), or $100 million.

Market cap is the public market's gauge of how much a company is worth.

Classification of Market Cap

  • Small cap companies with a market cap under $1B (under $2B in some classifications)
  • Mid cap companies with a market cap between $1-5B ($2B to $10B in some classifications)
  • Large cap companies with a market cap over $5B (over $10B in some classifications)

You may also see reference to "Mega cap" ($200B or more), "Micro cap" ($50M to $300M) and even "Nano cap" (under $50M).

Examples of Mega cap include companies like Exxon Mobil and Apple (AAPL).

Examples of Large cap include companies like Google.

Market Cap Classes and Risk

For investors it is important to have some knowledge of how different classes behave. In general, the larger the market cap the greater the stability and the lower the risk. In general, large caps are mature companies and small caps are younger, growing companies. Small caps carry greater risk, but also more upside potential than large caps.

Some mutual funds focus on specific market cap classes and some strive for a mix of different classes.

Other Uses of Market Cap

The market capitalization or size of an industry, or entire stock exchange or entire nations may be calculated.

By the end of 2007 the market cap of the NY Stock Exchange was $15.65 trillion. Including the American SE and NASDAQ the total market cap for the US was $19.92T. The market cap for the entire world was just more than $55T at that time.

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