What is the market capitalization of a company?

Market capitalization is used to bucket companies by size. Although the thresholds vary by source, the most widespread convention places large caps above around €10,000 million, mid caps roughly between €2,000 and €10,000 million, and small caps below €2,000 million. Below about €300 million you talk about micro caps, and the giants that exceed €200,000 million are known as mega caps.

This classification is not mere labelling: each segment behaves differently. Large caps tend to be more stable, liquid and followed by analysts, while small and mid caps offer greater growth potential in exchange for more volatility, less coverage and, sometimes, lower liquidity. Historically, the smaller segments have tended to deliver more return over the long run, but along a bumpier road.

The mid-cap universe is especially interesting because it combines solidity and room to run. DeepTicker's momentum strategy operates precisely on the S&P MidCap 400: US companies of between roughly €2,000 and €10,000 million that have already proven profitability and liquidity, but are not yet the mature giants of the S&P 500. It is a terrain where rigorous analysis makes the difference, because there are fewer eyes watching than in the mega caps.

Market capitalization measures the value of the company's equity (its shares), while enterprise value measures what it would cost to buy the whole business, adding net debt. The formula is: enterprise value = capitalization + debt - cash. The difference matters because two companies with identical capitalization can have very different enterprise values depending on their debt.

That's why, to compare the valuation of companies fairly, professional ratios such as EV/EBITDA use enterprise value and not capitalization. A heavily indebted company looks 'cheap' on capitalization but stops being so when you incorporate its debt into the calculation. Ignoring this is one of the most expensive mistakes of superficial analysis.

DeepTicker integrates this view into its analysis: when it values whether a stock is expensive or cheap with the Reverse DCF, it works on the whole business and applies the real cost of capital (WACC) by industry from public sector references, instead of a generic percentage. Using the real WACC instead of a back-of-the-envelope 8.5% can change the estimated value between 15% and 30%, so the detail is not trivial.

A frequent misunderstanding is to believe that market capitalization is what a company 'is worth'. In reality it is what the market is willing to pay today, which can be well above or below its fair value according to fundamentals. Capitalization reflects price and sentiment; intrinsic value reflects the business's ability to generate cash in the future.

A company can have an enormous capitalization sustained on expectations that do not materialise, or a modest capitalization despite an excellent business. The history of bubbles is, in large part, the history of capitalizations disconnected from fundamentals. That's why a rigorous investor does not stop at how much a company capitalizes, but at whether that price makes sense.

That's where DeepTicker connects the size data with deep analysis. Capitalization tells you how much the company weighs; the Reverse DCF tells you what growth and what margin that price is pricing in, and the DeepScore tells you whether the company has the quality to deliver it. By putting the three pieces together you stop looking at the price and start judging the value, which is what separates speculating from investing with criteria.

In DeepTicker's search you enter the name or ticker of any US, European, IBEX or China company and instantly see its market capitalization next to the rest of the key data. It is the first reference to place the size of the company before entering the fine analysis.

If what you want is to discover companies by size, the screener with more than 140 filters lets you narrow the universe by capitalization (only small caps, only mid caps, etc.) and combine it with any other metric: growth, profitability, debt or valuation. You can even start from classic presets such as Graham or the Magic Formula and adjust them to your preferred size range.

And because on DeepTicker every figure comes explained, you not only see the capitalization: you understand why size matters, how it differs from enterprise value and how it fits into a complete valuation. Serious fundamental analysis, made simple, so you learn while you search. Remember that all this is information and analysis, not financial advice.