Shares Outstanding

Shares outstanding counts every share that a company has issued and that is held by investors, from individual shareholders to large funds and company insiders. It excludes treasury shares, which the company has bought back and holds itself.

This number is a key building block for many calculations. Market capitalization is share price times shares outstanding. Earnings per share is net income divided by the weighted average number of shares outstanding over the period.

The count changes over time. It rises when a company issues new shares, for example in a secondary offering, through employee stock compensation or in an acquisition paid in stock. It falls when the company buys back shares. Stock splits and reverse splits change it by a fixed factor.

It is helpful to distinguish shares outstanding from the public float, which includes only shares freely available for trading, and from fully diluted shares, which also count options, warrants and convertible securities that could become shares.

Example: a company with 300 million shares outstanding trading at $20 has a market cap of $6 billion.