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+--- Thread: IS MARET CAPITALIZATION THE SAME AS MARKET VALUE? (/thread-145120.html)
IS MARET CAPITALIZATION THE SAME AS MARKET VALUE? - gentleghost915 - 04-28-2014 12:48 AM
N THE STOCK MARKET, MARKET CAP IS (SHARE PRICE) X (OUTSTANDING PRICE).
IN REAL ESTATE MARKET VALUE IS PRICE OF A HOME BEING SOLD FOR.
TAKE FACEBOK ITS MARKET CAP IS 171 BILLION. DOES THIS MEAN ITS THE SAME AS MARKET VALUE. IF SOMEONE WANTED TO COMPLETELY PURCHASE FACEBOOK DOES IT MEAN ITS WORTH 171 BILLION?
IF MARET CAP IS THE SAME AS MARET VALUE, CAN SOMEONE EXPLAIN TO ME HOW FACEBOOK (FB) 171 BILLION IS WORTH MORE THEN CITIGROUP © 152 BILLION?
FACEBOOK (FB)
REVENUE 7.8 BILLION
OPERATING INCOME 2.8 BILLION
NET INCOME 1.5 BILLION
MARKET CAP 171 BILLION
CITIGROUP ©
REVENUE 76.3 BILLION
OPERATING INCOME 19.4 BILLION
NET INCOME 13.6 BILLION
MARKET CAP 152 BILLION
I DONT THINK MARKET CAP IS THE SAME AS MARKET VALUE. THE REVENUE AND PROFITS OF THE TWO DONT ADD UP FOR FACEBOOK TO BE WORTH 19 BILLION MORE THEN CITIGROUP. CITIGROUP MAKES ABOUT MORE 10 TIMES REVENUE AND 9 TIMES MORE PROFIT THEN FACEBOOK.
IF I CAN GET SOME EXAMPLES/EXPLAINING THE DIFFERENCE BETWEEN THE TWO, IT WILL BE GLADLY APPRECIATED. THANK YOU.
- Mohammad - 04-28-2014 12:55 AM
As per under noted site, Market Capitalization is the product of the number of shares outstanding and the stock share price and it vary on a daily-basis (as do the stock price), the market capitalization is a measure of how big or small a company is.
It represents the current market value of a company or how much a company is worth in traders and investors' eyes.
For example, if a stock price is $50 and that stock has 20 million outstanding shares then its market cap is equal to $1 billion (50*20mil).
This doesn't mean that the market capitalization reflects the true value of a company. It could be used a starting point for evaluation but you must be aware that market cap reflects the equity value of a company and the true value of a company should use equity, debt and other factors.
Enterprise value (EV) is more comprehensive than market capitalization and it is a better economic measure of the market value of a business.
Stocks are usually classified based on their size or market capitalization (also called market cap). Depending on this value, a stock could be a classified as a large-cap stock, a mid-cap, a small-cap or a micro-cap.
Read more: http://www.quantshare.com/item-682-market-cap-historical-data-for-the-us-stock-market#ixzz2x5rEWwOb
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