- Shares outstanding refer to a company's stock currently held by all its shareholders.
- These include share blocks held by institutional investors and restricted shares owned by the company’s officers and insiders.
- A company's number of shares outstanding is not static and may fluctuate wildly over time.
What does outstanding shares mean in stocks?
- So at any given point in time, outstanding stocks number cannot be higher than the number of authorized shares. ...
- If the company issue all the authorized shares but then need to grant more shares in the future, the company would need to authorize more shares at that point.
- It requires a board and stockholder vote, and then a document to be filed. ...
What is the formula for outstanding shares?
What is the Shares Outstanding Formula?
- Examples of Shares Outstanding Formula (With Excel Template) Let’s take an example to understand the calculation of Shares Outstanding in a better manner. ...
- Explanation. ...
- Relevance and Use of Shares Outstanding Formula. ...
- Shares Outstanding Formula Calculator. ...
How do you find shares outstanding?
You must sign in to rate.) Sao Mai Group Corporation reported adjustment of change in the number of outstanding voting shares:
What do outstanding shares mean?
Shares outstanding refer to a company's stock currently held by all its shareholders, including share blocks held by institutional investors and restricted shares owned by the company’s officers...
What does outstanding stock mean?
Not to be confused with authorized shares, outstanding shares refer to the number of stocks that a company has issued. This number represents all the shares that can be bought and sold by the public, as well as all the restricted shares that require special permission before being transacted.
Is it good for a stock to have outstanding shares?
The owners of outstanding shares have the right to receive dividends and also have voting rights in the corporation. Outstanding shares are an important part of calculating metrics for a corporation. In addition to market capitalization, outstanding shares can be used to calculate cash flow and earnings per share.
How do you get shares outstanding?
You can calculate the shares outstanding by taking the total shares issued minus the number of treasury shares that have been repurchased by the company. This number also represents the number of available shares on that company's open market.
Is it better to have more or less shares outstanding?
The number of shares outstanding is also significant to know because a firm could choose to issue more stock if it has authorized more shares than it currently has outstanding. If the company decides to sell additional authorized shares, it can reduce the value of the existing shares.
Why are shares called outstanding?
Key Takeaways. Shares outstanding refer to a company's stock currently held by all its shareholders. These include share blocks held by institutional investors and restricted shares owned by the company's officers and insiders. A company's number of shares outstanding is not static and may fluctuate wildly over time.
What is the difference between shares issued and outstanding?
Issued shares are the total shares issued by the Company. Whereas outstanding shares are the shares with the shareholders, i.e., it does not include the shares repurchased by the Company. Thus, subtracting treasury shares from the issued shares will give outstanding shares.
What company has the most shares outstanding?
1. Berkshire Hathaway. Berkshire Hathaway (BRK. A) has the highest-priced shares of any U.S. company, and is also one of the largest companies in the world, consistently ranking in the top 10 by market value.
How many shares of common stock are outstanding?
Shares outstanding is the total number of shares issued and actively held by stockholders. Floating stock is the result of subtracting closely-held shares from the total shares outstanding to provide a narrower view of a company's active shares.
What is Outstanding Stock?
Outstanding stock is shares issued by a corporation that are currently held by investors and corporate insiders. The amount of outstanding stock is used to calculate earnings per share and cash flow per share, which in turn are used by investors to derive the value of a business.
Reporting of Outstanding Stock
Outstanding stock information is considered a critical item to be reported in the financial statements of publicly-held companies. This is not the case for privately-held companies, which may not release this information at all. The accounting standards do not require a private company to report earnings per share.
Definition of Outstanding Stock
Outstanding stock refers to the stock that is owned by the public stockholders of a company. There may be more stock available than is held by stockholders, either because the company has reacquired it or because it is still for sale. But what exactly is stock, anyway?
Authorized and Issued Stock
So how does all this work? First, a company that wants to offer stock for sale must decide how much money it wants to raise, and how much of the company it wants to offer for sale to the public in order to raise that money. This will determine the maximum number of shares of stock it would like to authorize.
Outstanding Stock
Once I issue stock, I wait for people to buy it. All the stock that gets bought by the public is called the outstanding stock. For example, if all of the 400 shares of stock that I issued in the last example were bought by the public, I would have 400 shares of stock outstanding.
What Does Outstanding Stock Mean?
When a company is incorporated, it drafts a corporate charter that dictates the number of shares the corporation has to issue. This could be any number. The corporate charter could authorize 10 shares or 10,000,000 shares. The people organizing the company can decide that.
Example
Take Compass, Inc. for example. Compass’ corporate charter authorized it to issue 30,000. Compass sold and issued 10,000 shares to the original investor who founded the company. Now Compass has 30,000 shares authorized and 10,000 shares outstanding.
Basic and Diluted Shares Outstanding
The number of shares outstanding can be computed as either basic or fully diluted.
Shares Outstanding vs. Treasury Shares
Outstanding shares differ from treasury shares Treasury Stock Treasury stock, or reacquired stock, is a portion of previously issued, outstanding shares of stock that a company repurchased from shareholders. , which are the shares held by the company itself and which cannot be sold in the open market.
Authorized Shares
The number of authorized shares can be substantially greater than the number of shares outstanding since authorized shares represents the maximum possible number of shares a company can issue. The outstanding number of shares may be either equal to or less than the number of authorized shares.
Shares Outstanding vs. Floating Shares
The number of floating shares is found by taking the number of shares outstanding minus closely-held shares – a large number of shares that are held by one party, be it an individual or a small group of controlling shareholders, such as officers or directors of the company.
Where to Find the Number of Shares Outstanding?
There are some useful public sources of information where the total number of shares outstanding can be found. They include:
Share Repurchase Program
When companies consider their stocks to be undervalued, they often initiate a share repurchase program, buying back some of its issued shares at a favorable price.
More Resources
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Understanding outstanding shares
The number of shares outstanding for a company is equal to the number of shares issued minus the number of shares held in the company's treasury. If a company buys back its own stock, those repurchased shares are called treasury stock.
Why shares outstanding is useful
A company's number of shares outstanding is used to calculate many widely used financial metrics. Market capitalization — share price times number of shares outstanding — and EPS are both computed using a company's number of outstanding shares.
Outstanding vs. issued vs. float
A company's number of shares outstanding is the number of shares investors and company executives currently own, while the number of issued shares is the number of shares that have ever been traded in the stock market. A company's number of issued shares includes any shares the company has bought back and now holds in its treasury.
Outstanding Shares Explained
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Definition and Examples of Outstanding Shares
Companies issue different types of shares of equity, the largest and most common type being common shares. Common shares represent ownership interest in a company, and they typically come with voting rights and cash flow (dividend) rights.
How Outstanding Shares Work
Public reports in which companies list the total outstanding shares include a quarterly or annual report or a balance sheet. These reports often can be found on a company’s investor relations page.
Types of Shares
Companies may issue different classes of shares, the most common being “common” or “ordinary shares.” The different types of shares denote different rights for the shareholder. For example, shares may come with or without the power to vote on board appointees and other corporate matters.
Outstanding Shares vs. Treasury Shares
While outstanding shares of stock are those that can be purchased or sold on the secondary market, treasury shares are those that are held by the company and are not available in the open market. The total number of issued shares is the sum of the outstanding shares and the treasury shares.
What It Means for Individual Investors
Knowing the number of outstanding shares a company has issued, as well as the types of shares, is all part of making smart investment decisions. Determining a company’s market capitalization and earnings per share are critical components of smart investors’ analysis process. To get there, you need to know the number of outstanding shares.
Learn why the stock market and individual stocks tend to fluctuate and how you can use that information to become a better investor
Tim writes about technology and consumer goods stocks for The Motley Fool. He's a value investor at heart, doing his best to avoid hyped-up nonsense. Follow him on Twitter: Follow @TMFBargainBin
What affects stock price?
High demand for a stock drives the stock price higher, but what causes that high demand in the first place? It's all about how investors feel:
The big picture is what matters
Long-term investors, like those of us at The Motley Fool, don't much care about the short-term developments that push stock prices up and down each trading day. When you have years or even decades to let your money grow, analyst reports and earnings beats are often fleeting and irrelevant.
How Is Share Price Determined?
Generally speaking, the prices in the stock market are driven by supply and demand. This makes the stock market similar to other economic markets. When a stock is sold, a buyer and seller exchange money for share ownership. The price for which the stock is purchased becomes the new market price.
Misconceptions About Market Capitalization
Although it is used often to describe a company (e.g. large-cap vs. small-cap ), market cap does not measure the equity value of a company. Only a thorough analysis of a company's fundamentals can do that.
