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Question regarding Market Cap

Posted on 1/22/14 at 4:04 pm
Posted by OnTheBrink
TN
Member since Mar 2012
5418 posts
Posted on 1/22/14 at 4:04 pm
So I was looking at my yahoo ticker and noticed MSFT ($35.93/share) with a market cap of 299.94B and Hershey ($99.83/share) with a market cap of 22.32B and Staples ($13.82/share) with a market cap of 9.03B, or almost half of Hershey.

Investopedia just taught me that the market cap is price x outstanding shares. I guess first, why does this matter? And secondly, what does/should this tell me about these companies, if anything in regards to investing in them?

TIA and FWIW, this is not a homework assignment.
Posted by lighter345
Member since Jan 2009
11876 posts
Posted on 1/22/14 at 4:17 pm to
LINK

This should help explain.


Generally though the smaller the market cap the higher risk/reward and the larger the market cap the lower risk/reward.

Large is generally $10billion plus. Medium $1-10billion and small is $1billion and below and then you get into micro/nano caps I guess.

This post was edited on 1/22/14 at 4:21 pm
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