Recent Examples of capital stock from the Web
The ratio of the capital stock — the value of factories, machines and such — to the nation’s economic output has actually declined a little since the 1970s.
But that should be a one-time adjustment, after businesses increase their capital stock in response to more favorable policies.
According to an analysis by Germán Gutiérrez and Thomas Philippon of New York University, the ratio of the market value of American corporations to the replacement value of their capital stock has roughly tripled since the 1970s.
On the other hand, the new plan excludes two-thirds of America’s capital stock, plants, warehouses and other structures, from the benefits of full expensing.
The company’s net income rose to $6.73 billion, or $9.57 per Class A and B share and Class C capital stock, in the third quarter ended Sept. 30 from $5.06 billion, or $7.25 per share, a year earlier.
By contrast, the 2.1% average annual growth rate observed from 2011-16 combined the same rapid employment growth with a feeble 1.7% expansion of the capital stock and total factor productivity of just 0.5%.
These example sentences are selected automatically from various online news sources to reflect current usage of the word 'capital stock.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.
First Known Use of capital stock
Financial Definition of CAPITAL STOCK
What It Is
Capital stock is the number of shares that a company's charter authorizes for issuance.
How It Works
A corporate charter is a legal document that sets forth a corporation's basic information, such as its location, profit/nonprofit status, board composition, and ownership structure. Corporate charters typically include the number of shares that the company is authorized to issue (both common and preferred stock) in total forever. The founders and board members typically decide what the amount of capital stock will be, with input from their attorneys and industry norms. The capital stock amount becomes public record when the company files the corporate charter with the secretary of state for the state in which the corporation is headquartered.
Why It Matters
Capital stock is not necessarily equal to the number of shares that are currently outstanding; capital stock is the maximum number of shares that can ever be outstanding. If companies want to change this number, they must amend their charters. When companies do this, it may be an indication that companies intend to raise capital.
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