> Market cap isn't the value of a company, but rather the value investors place on the shares times outstanding shares.
What's the difference? (honest question)
My understanding is that, theoretically, share price is intended to reflect expected value of future payouts (dividends) assuming the company lasts forever. In practice, I would think share price is more likely to reflect expected value of future payouts over some fixed time period plus expected time-adjusted price appreciation over that same interval, which seems to be at least as reasonable a method.
What is the (monetary) value of a company other than return to owners?
it is certainly one valuation but there are other measures too. To give an example of one problem with that measure it would imply that when the stock market is volatile that the company value is too when there may be no news or changes in the company prospects so for me it is hard to regard the market cap as a measure of true value (although it does give a quick estimate).
What's the difference? (honest question)
My understanding is that, theoretically, share price is intended to reflect expected value of future payouts (dividends) assuming the company lasts forever. In practice, I would think share price is more likely to reflect expected value of future payouts over some fixed time period plus expected time-adjusted price appreciation over that same interval, which seems to be at least as reasonable a method.
What is the (monetary) value of a company other than return to owners?