All: The Three Meanings of Market Cap: 1. The potiential value of market cap is

All:

The Three Meanings of Market Cap:
1. The potiential value of market cap is a measure of the moment.
2. The utility value of market cap is in borrowing capacity for the holder over the visible tim horizon.
3. The demonstrated value of market cap is it’s liquidation value under duress over the long term.

As someone who has bought, merged, rolled-up, and sold a lot of companies in my life, I think in terms of liquidation value, cash accounting (cash flow), debt, and risk. Everything else is accounting manipulation to please lenders and the tax man.

Reply addressees: @BobMurphyEcon