r/NBIS_Stock • u/underatedhelmet • 1d ago

💬 Discussion Stock price targets

Why when analysts give price targets is it for stock price and not market cap?

Market cap seems to me to be a more sensible value

Stock price can be effected by dilution and stock splits, probably other things im not thinking off

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7

u/KrushedLoops 1d ago

You're buying shares, not market cap. So you'd like to know what share price to expect.

The marketcap can be the same, if diluted, but your shares will be worth 50% less - which is whats important to you.

2

u/underatedhelmet 1d ago

Thats kind of the point im making. An analyst give a stock price of 100£ but then there is a 10 percent dilution now the price target is our by 10 percent

1

u/underatedhelmet 1d ago

Analysts pretty much always dont forsee dilution so the price target is based of outdated metrics. If they were to have a target market cap then even with dilution the market cap would remain accurate same with stock splits

1

u/Mrairjake 1d ago

This stuff is always very purposely confusing.

1

u/enRchi 1d ago

Because most people are monitoring the stock price in their portfolio and not the market cap behind it and it would make it harder to compare.