You can find the total number of shares in the shareholders’ equity section of a company’s balance sheet, which also summarizes the assets and liabilities. The numbers of authorized, issued and outstanding common shares are listed in this section, along with the number of preferred shares.
To calculate this market value, multiply the current market price of a company’s stock by the total number of shares outstanding. The number of shares outstanding is listed in the equity section of a company’s balance sheet.
The number of ordinary shares an investor owns is proportional to the percentage of ownership he/she has in a company. For instance, if a company issues all of its 50 shares in the stock market and you own 30 out of them. You would have a 60% ownership of the company. Ordinary shares come with a wide array of benefits.
Let us make in-depth study of the five methods of valuation of shares, i.e., (1) Asset Backing Method, (2) Yield-Basis Method, (3) Fair Value Method, (4) Return on Capital Employed Method, and (5) Price-Earning Ratio Method.
Share Capital Formula
- Formula 1: Share capital equals the issue price per share times the number of outstanding shares.
- Formula 2: Share capital equals the number of shares times the par value of stock plus the paid in capital in excess of par value.
What Are Ordinary Shares? Ordinary shares, also called common shares, are stocks sold on a public exchange. Each share of stock generally gives its owner the right to one vote at a company shareholders’ meeting. Unlike in the case of preferred shares, the owner of ordinary shares is not guaranteed a dividend.
If you know the number of treasury stock, or shares reclaimed by the company but not retired, and the number of shares outstanding, you can calculate shares issued: shares issued = shares outstanding + treasury stock.