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Micro Cap

Categories: Investing

Tiny company. Tiny valuation. Micro.

Like...a small cap company in today's Street parlance is likely a company worth about $1-$5 billion. And no, there's no set standard or ubiquitous set of numbers that divides value grids here. So if "small" is a billion, then "micro" is, eh, under a billion. Like...maybe companies valued from $200 million or so, up to a bil? Something like that. See: Shares Outstanding. See: Market Capitalization.

Remember that, in order to get these valuations, at least roughly, you take the total shares outstanding of the company and just multiply them by the stock price. So if MicroNuts had 100 million shares outstanding, which were trading for 5 bucks a share, it'd be worth half a bil. And yes, while that's a lot of nuts in real life, half a bil in today's world is a Micro Cap stock.

Find other enlightening terms in Shmoop Finance Genius Bar(f)