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Total Cash per Share (MRQ)

Total Cash per Share (MRQ)

Total cash per share divides the company's cash balance by the number of shares. It shows how much cash backs each share of stock.

How it relates

Total Cash (MRQ)Total cash (MRQ) is the amount of cash and cash-like assets the company had at the end of the most recent quarter. It shows the immediate financial buffer available.÷Shares OutstandingShares outstanding is the total number of shares that exist for this company. It's used to calculate things like market value and earnings per share.=Total Cash per Share (MRQ)

Where it fits

Total Cash per Share (MRQ)→Liquidity

Total cash per share divides a company's total cash and cash equivalents by the number of outstanding shares, showing how much liquid assets back each share. This metric helps investors understand the cash cushion on a per-share basis and can be compared directly to the stock price to assess how much of the share price represents cash versus operating business value.

The calculation:

Total Cash Per Share = Total Cash and Equivalents / Shares Outstanding

For example, if a company holds $10 billion in cash with 2 billion shares outstanding, cash per share is $5.

Why cash per share matters:

  • Floor value indicator: In extreme cases, cash per share suggests minimum liquidation value
  • Valuation adjustment: Subtract cash per share from stock price to value the operating business
  • Buyback capacity: Shows potential for share repurchases
  • Dividend coverage: Indicates ability to maintain or increase dividends

Practical applications:

  • Enterprise value: Stock price minus cash per share plus debt per share
  • Value investing: Stocks trading near cash per share may be undervalued (or have serious problems)
  • Growth assessment: High cash per share in growth companies signals investment capacity

Example analysis:

Stock price: $50
Cash per share: $15
Operating business value: $35 per share

Important considerations:

  • Cash location: Overseas cash may face repatriation taxes or restrictions
  • Restricted cash: Some cash may be legally restricted for specific purposes
  • Debt offset: Net cash per share (cash minus debt divided by shares) is often more meaningful
  • Burn rate: For unprofitable companies, cash per share depletes over time

Compare cash per share trends over time and against peers. Rapidly declining cash per share in a loss-making company signals potential financing needs, while growing cash per share indicates strong cash generation.