IPO Investing Glossary

IPO University

Market Capitalization

The total market value of a firm. It is defined as the product of the company's stock price per share and the total number of shares outstanding. In the case of a newly public company, the total shares outstanding can greatly exceed the float, due to lock-up agreements. Companies often pay their employees with stock options, so buy side analysts look at the fully-diluted share count to calculate market cap.


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