Capital stock is the number of common and preferred shares that a company is authorized to issue, and is recorded in shareholders' equity. It is the total amount of physical capital at any particular moment in time.Capital is one of the factors of production. Capital stock is the total amount of stock, both common and preferred, that a public company has the authorization to issue. Capital stock are equity holders in the company. It is usually issued when companies are trying to fund their growth. Capital formation is a concept used in macroeconomics, national accounts and financial economics. Occasionally it is also used in corporate accounts.