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It is insane to set market cap goals instead of share price goals. The market cap of Tesla can go up without ever benefitting shareholders.
by xkjkls 6y ago
It is insane to set market cap goals instead of share price goals. The market cap of Tesla can go up without ever benefitting shareholders.
- totalZero 6y agoMarket cap goals and share price goals are the same thing. Share price is simply market cap divided by the number of shares outstanding.
- xkjkls 6y agoYes, but in the case of issuance of new shares they aren’t. Stock based compensation adds to the market cap but not to the stock price. Same with acquisitions done in stock. You could merge your company with another company the same value and double the market cap without the share price changing.