Market capitalization is the total dollar value of a company’s shares. In mathematical formula:

Market capitalization = Number of shares X Price of 1 share

The investment community uses this figure to determining a company’s size, as opposed to sales or total asset figures.

An example, Apple (AAPL) has a 932.15 million shares and the current price of each share is $424.33. Thus, Apple’s market capitalization is $ 395.53 billion.