Market Capitalization
A quoted equity-value measure based on a selected share price and share count—not the value of the whole enterprise.
Market capitalization is a quoted equity value calculated as a share price multiplied by a selected number of shares outstanding. The result depends on the price timestamp, share class, basic or diluted share count, and treatment of restricted or nontraded shares. It is not the same as enterprise value, acquisition cost, or intrinsic value.
Frequently Asked Questions
Should market cap use basic or diluted shares?
Market data services often use current basic shares outstanding, while valuation models may use diluted shares. The appropriate convention depends on purpose and should be stated consistently.
How are multiple share classes handled?
Each listed class may have a different price, voting right, or economic claim. A total equity value may require valuing each class separately rather than multiplying one price by all shares.
Does market cap show what a company is worth?
It shows the market value of selected equity claims at quoted prices. It does not include debt-like claims, control premiums, transaction costs, liquidity effects, or the adjustments used in enterprise or intrinsic value.
Are small-cap and large-cap thresholds universal?
No. Category cutoffs vary by index provider, market, currency, date, and methodology. They should not be treated as permanent company-quality classifications.