DPS Dividend Yield Pushes Past 3% Friday, July 27, 3:07 PM ET, by Market News Video Staff In trading on Friday, shares of Dr Pepper Snapple Group Inc (DPS) were yielding above ...
DPS Ex-Dividend Reminder - 9/13/12 Tuesday, September 11, 10:38 AM ET, by Market News Video Staff On 9/13/12, Dr Pepper Snapple Group Inc (DPS) will trade ex-dividend, for its quarterly dividend ...
Market capitalization is an important data point for investors to keep an eye on, for various reasons. The most basic reason is that it gives a true comparison of the value attributed by the stock market to a given company's stock. Many beginning investors look at one stock trading at $10 and another trading at $20 and mistakenly think the latter company is worth twice as much — that of course is a completely meaningless comparison without knowing how many shares of each company exist. But comparing market capitalization (factoring in those share counts) creates a true "apples-to-apples" comparison of the value of two stocks. In the case of Dr Pepper Snapple Group Inc (NYSE:DPS), the market cap is now $9.24 billion, versus Coca-Cola Enterprises Inc (NYSE:CCE) at $9.19 billion.
Below is a chart of Dr Pepper Snapple Group Inc versus Coca-Cola Enterprises Inc plotting their respective size rank within the S&P 500 over time (DPS plotted in blue; CCE plotted in green):
Below is a three month price history chart comparing the stock performance of DPS vs. CCE:
Another reason market capitalization is important is where it places a company in terms of its size tier in relation to peers — much like the way a mid-size sedan is typically compared to other mid-size sedans (and not SUV's). This can have a direct impact on which mutual funds and ETFs are willing to own the stock. For instance, a mutual fund that is focused solely on Large Cap stocks may for example only be interested in those companies sized $10 billion or larger. Another illustrative example is the S&P MidCap index which essentially takes the S&P 500 index and "tosses out" the biggest 100 companies so as to focus solely on the 400 smaller "up-and-comers" (which in the right environment can outperform their larger rivals). So a company's market cap, especially in relation to other companies, carries great importance, and for this reason we at The Online Investor find value to putting together these rankings daily.
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Now Playing: The Importance Of Market Cap
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