Shares Issued & Shares Outstanding (Shares Outstanding)
The total number of shares a company has issued — the base number that serves as the denominator for market cap, EPS, and many other metrics.
Market cap = share price × shares outstanding
When the share count rises (through stock offerings, stock-based compensation, and the like), the slice of the company held by each existing share gets thinner.
In plain terms
How many slices one pizza (the whole company) is cut into is the share count. The share price is the "price of one slice," so to know the value of the whole company (market cap) you have to multiply by the number of slices.
For the same company, cutting it into many small slices makes one slice look low-priced, and cutting it into few large slices makes it look high-priced. That's why you need to look at the share count, not just the price, to see the size of the company.
What it tells you
The share price alone doesn't tell you the size of a company. Only by multiplying by shares outstanding to get market cap can you know "what the whole company is worth." So a low share price doesn't mean a "lower-priced stock" either — the company may simply have been cut into many small slices, making one slice's price small.
There's a trap here that is hard to see. The share count isn't displayed prominently every day the way the price is, so when a company issues new shares each year for things like employee compensation, your ownership stake quietly gets diluted. The loss of "the price staying the same while your slice shrinks" happens without being noticed.
Formula
Market cap = share price × shares outstanding EPS (earnings per share) = net income ÷ shares outstanding (Float = the portion of shares outstanding actually available to trade in the market)
What high or low means
When the share count rises (through stock offerings, stock-based compensation, and the like), the slice of the company held by each existing share gets thinner. This is called "dilution."
Conversely, when a company buys back its own shares and retires them, the share count falls and each share represents a bigger slice. So what one share represents depends on which way the share count moves.
"Shares outstanding" and "float" are not the same. Take what has been issued, subtract the portion held by large shareholders or the company itself, and what actually trades in the market is the float. When the float is small, even light trading can swing the price a lot.
At a company whose share count only rises year after year, the per-share slice can stay flat or even shrink even as profits grow. So what comes back to one share is set by earnings growth and the change in share count together.
The share count is not a fixed number. It rises with offerings and stock-based compensation and falls with buyback retirements, so it differs from one point in time to another.
Metrics to read alongside
Guides that cover this term
See it in real stocks
Search US stocks on Stocklore to see SEC-filing-based financial metrics alongside the sector benchmark.
This explanation is for information and reference only and is not a recommendation to buy or sell any security. Investment decisions and their consequences are your own.