Definition: Market share is a firm's percentage of an industry's total sales. It is calculated as the product of the firm's sales over the industry's sales during a specified period. For example, Apple has a huge MS is smartphone industry, but it has a small MS in the personal computing industry.
Is market share the same as stock price?
Share price refers to the market price of a share of stock in a public (or private) company. Market share is the percentage of the market that a company controls or derives profit from in the course of business.
Is higher market share good?
A higher market share puts companies at a competitive advantage. Companies with high market share often receive better prices from suppliers, as their larger order volumes increase their buying power.
What is the market share means?
Market share is the percent of total sales in an industry generated by a particular company. Market share is calculated by taking the company's sales over the period and dividing it by the total sales of the industry over the same period.
How do you find the market share?
A company's market share is its sales measured as a percentage of an industry's total revenues. You can determine a company's market share by dividing its total sales or revenues by the industry's total sales over a fiscal period. Use this measure to get a general idea of the size of a company relative to the industry.
What are the factors of market share?
- The level of the earnings base (represented by measures such as EPS, cash flow per share, dividends per share)
- The expected growth in the earnings base.
- The discount rate, which is itself a function of inflation.
- The perceived risk of the stock.
What is relative market share example?
For example, suppose the top tire store in town sells $4 million worth of tires a year, a 13 percent market share. To figure relative market share, divide your share by theirs: 5 percent divided by 13 gives you a 38.4 relative market share. You can do the same for the No. 2 and 3 companies if you wish.
What are examples of market share?
Market share is the percentage of the total revenue or sales in a market that a company's business makes up. For example, if there are 50,000 units sold per year in a given industry, a company whose sales were 5,000 of those units would have a 10 percent share in that market.