Shares outstanding

Posted on October 9th, 2008 by admin, under shares.

Shares outstanding are also called outstanding stock. It is a very easy concept to understand. Basically it is the number of stocks that are held by investors. This includes restricted shares owned by company officers and insiders, as well as common shares held by the public. If a company buys back stock, these shares are not considered outstanding. Anotherwords this is shares of a corporation’s stock that have been issued and are in the hands of the public.
Number of common shares that have been authorized, issued, and purchased by investors is very important in calculating many more advanced metrics. For example to find the market cap you have to multiply the price per share by the outstanding shares, and to find the EPS you divide the net income minus dividends by the outstanding shares.
Number of shares of a firm held by its shareholders (shares outstanding) equals the total number of shares issued less the number of shares repurchased. It can be calculated as either basic or fully diluted, with the effect of such diluting securities as options or convertibles. Shares outstanding can be obtained from quarterly filings with the SEC (United States Securities and Exchange Commission).