IS MARET CAPITALIZATION THE SAME AS MARKET VALUE?

[Mohammad]

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.




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