Generally speaking, large cap companies have at least $8 billion of.
outstanding shares. The formula for market capitalization is:
Market Capitalization = Current Price x
It is important to that cap is not the same as equity value, nor is it equal to a company's debt plus its shareholders' equity (although that too is sometimes referred to as simply the company's ).
Let's assume Company XYZ has 10 million 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 100 million x $90 = $9 billion. Company XYZ is a large cap stock.
Many investors regard large cap income investors. However, reflects the theoretical value of a company, not what the company could be purchased for in a normal merger transaction. One reason for this is that the value of material nonpublic information, management changes, operating synergies between the and the company, and other intangible factors may not be reflected in the price or the financial statements.as more mature and more stable. Accordingly, they are often attractive to conservative investors and