How Do You Spell OUTSTANDING SHARE?
Pronunciation: [a͡ʊtstˈandɪŋ ʃˈe͡ə] (IPA) 
Pronunciation: [a͡ʊtstˈandɪŋ ʃˈe͡ə] (IPA)
An outstanding share refers to a unit of ownership in a corporation that has been issued and is currently held by shareholders. It represents the portion of the company's equity that is in the hands of investors. In simple terms, outstanding shares encompass all the shares of stock that have been sold or allocated by the company, excluding any repurchased or retired shares.
The number of outstanding shares is a significant metric when evaluating a company's financial health and calculating key ratios like earnings per share (EPS) or market capitalization. It influences the company's market value and the amount of ownership entitlement each shareholder possesses.
Outstanding shares can also be used to compare the ownership structure and dilution effects caused by various financial instruments such as stock options, convertible bonds, or warrants. Understanding the number of outstanding shares is crucial in assessing the voting power of shareholders during corporate governance matters or decision-making processes, as it is directly proportional to their influence and control over the company.
Furthermore, outstanding shares can fluctuate over time due to corporate actions such as stock splits, stock dividends, share repurchases, or new issuances. This dynamic nature of outstanding shares highlights the importance of regularly updated information when analyzing a company's capital structure and ownership distribution.
The term "outstanding shares" in finance refers to the total number of shares of a corporation's stock that are owned by shareholders, excluding treasury stock (shares that a corporation has repurchased or held in its own possession).
The etymology of the term "outstanding" is derived from the Old English word "utstandan", which means "to stand out" or "to be prominent". The word combines "ut" (meaning "out") and "standan" (meaning "to stand"). It evolved over time to the Middle English word "outstanden" with similar meanings.
In the context of shares, "outstanding" refers to shares that are actively held by investors and are "outstanding" in the sense that they are not held by the corporation itself. The term is used to distinguish shares held by external parties from other types of shares such as treasury shares or authorized shares.
