stephen asked 5 years ago
Hi Peter,
Is the shares outstanding same meaning as the issued & paid-up shares (from ShareInvestor)?
So the company book value = shareholders’ equity / shares outstanding?
And the current markat cap. = current share price * shares outstanding?
I am bit confused on this.
1 Answers
Peter Lim Staff answered 5 years ago
Shares Outstanding = Shares Issued less Treasury Shares.
Company’s Book Value = Shareholder’s Equity. Both are the same.
When you take Shareholder’s equity (or Book Value) and divide by shares outstanding, you get Shareholder’s Equity (or Book Value) per share.
Yes, market cap = current share price (how much people are paying for 1 piece of “pizza”) * shares outstanding (the pizza is sliced into how many pieces) to get how much is the entire “pizza”.