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 Newfield Exploration Co (NFX), the market cap is now $8.92 billion, versus Mallinckrodt plc (MNK) at $8.50 billion.
Start slideshow:Below is a chart of Newfield Exploration Co versus Mallinckrodt plc plotting their respective size rank within the S&P 500 over time (NFX plotted in blue; MNK plotted in green):