Definition of market capitalization
: capitalization 1d
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Recent Examples of market capitalization from the Web
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Also at stake: the nearly $30 billion rise in Nintendo’s market capitalization since the Switch debuted a year ago.
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The company has gained about 40 percent -- adding $330 million in market capitalization -- since the Nikkei newspaper reported on Tuesday that the company was mulling an investment in Coincheck.
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Similarly, Facebook saw $100 billion in market capitalization evaporate in the Cambridge Analytica scandal, because its reputation transcended Mark Zuckerberg’s heartfelt promises to make Facebook a force for good.
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Apple’s dictatorial attitude doesn’t seem to be impacting its bottom line—the company’s market capitalization hovers just under $900 billion, and the company posted a record $88 billion in sales during its most recent quarterly earnings report.
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Since hitting its peak on Feb. 2, Facebook has lost an astonishing $100 billion in market capitalization.
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Based on back of the envelope calculations and estimates from Fundstrat, Bitcoin valuation could shed another $37 billion in the near future, falling to about $99 billion in market capitalization.
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To remain on the Nasdaq, Long Blockchain needed to maintain a market capitalization of more than $35 million for at least 10 days.
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Tesla says the all-or-nothing package is worth $2.6 billion at current stock values, but that would rise dramatically if Musk meets 12 incremental goals including raising the company's market capitalization tenfold to $650 billion.
These example sentences are selected automatically from various online news sources to reflect current usage of the word 'market capitalization.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.
First Known Use of market capitalization
1975
Financial Definition of MARKET CAPITALIZATION
market capitalization
What It Is
Market capitalization refers to the value of a company's outstanding shares. The formula for market capitalization is:
Market Capitalization = Current Stock Price x Shares Outstanding
How It Works
Let's assume Company XYZ has 10,000,000 shares outstanding and the current share price is $9. Based on this information and the formula above, we can calculate that Company XYZ's market capitalization is $90 million (10,000,000 x $9 = $90 million).
Companies with less than $1 billion of market cap are generally regarded as small-cap companies. Large-cap companies usually have at least $8 billion of market cap. Companies in between are mid-cap companies.
Why It Matters
Market capitalization reflects the theoretical cost of buying all of a company's shares, but usually is not what the company would be purchased for in a normal merger transaction.
Thus market capitalization is a better measure of size than worth. This is why market capitalization is not the same as market value, which represents how much someone would actually be willing to pay for an asset (in this case, the entire company).
Source: Investing Answers
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