If you don't have a lot of investing experience, getting used to the way investors think about stocks can take a lot of time and effort. Often, you have to set your preconceptions about the business world aside and look at companies in a brand-new light.

One of the most basic ways that investors judge companies differently from most people is in sizing up how big a company is. Because big companies are often seen as the most stable, they make a great starting point for beginning investors. But the companies that show up at the top of the heap differ greatly, depending on how you look at them.

Size matters
If you ask most people what companies they think are the biggest, they'll often look to the largest employers. After all, a business with a large workforce wields a huge economic influence, especially in the cities where it has a factory or other business presence.

That's why big manufacturers such as Ford (NYSE:F) and General Motors (NYSE:GM), which both have hundreds of thousands of employees, play an important enough role in the national economy that they sought -- and received -- billions of dollars of support from the federal government.

But as the fortunes of those troubled automakers show, having a lot of employees doesn't guarantee that you'll have a successful, thriving business. To start thinking like an investor, you have to look beyond the most visible characteristics of a business and open up the books to see how a company ticks.

The money game
You may have tried to avoid it, but to be a good investor, you can't escape it: You have to look at financial statements. After all, even companies that have a lot of workers have to translate their work into money, and financial statements are where you'll see the scorecard of their efforts.

You'll find several measures of financial success on a company's income statement. Total revenue measures the amount of goods and services a company sells over a given period. So high-revenue businesses such as Wal-Mart (NYSE:WMT) -- which also happens to have a huge workforce -- have found ways to turn their ideas and strategies into cold, hard cash.

But just because you have a lot of sales, that doesn't mean you'll make money. That's why looking at net income can give you a better measure of how well a business is doing. If a company has high sales but low net income, then it's failing to capitalize on its customer base to generate profits. And because shareholders depend on profits so that a company can pay dividends or grow its business further, a company with strong net income growth will always be attractive. Lately, companies such as ExxonMobil (NYSE:XOM) and Chevron (NYSE:CVX) have dominated the list of top income-producing companies.

Put it all together
Investors have to consider all of these figures. Yet by themselves, these numbers aren't enough -- because they look only at a company at a given moment in time. Big oil, for example, has had great profits over the past 12 months. But with crude prices having fallen from more than $145 to below $50, most investors don't expect them to earn that much in the near future.

In contrast, share prices reflect not only past and current financial results but also prospects for future success. Therefore, most investors judge size ultimately by looking at a company's market cap -- the total value of all outstanding shares of a company's stock.

Let's look at how various companies compare on all those scales:


Full-Time Employees

Annual Revenue (Billions)

Annual Net Income (Billions)

Current Market Cap (Billions)






General Motors










Microsoft (NASDAQ:MSFT)





Procter & Gamble (NYSE:PG)















General Electric





Source: Yahoo! Finance. As of Jan. 26.

As the numbers show, you get much different rankings for these companies as you switch from column to column. Moreover, the whole set of numbers gives you a much more complete picture than what you'd get just from looking at a single figure.

So as you look at companies, don't shy away from looking at their financials. You'll get a whole new perspective that you don't get simply from general knowledge.

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Fool contributor Dan Caplinger has been learning about stocks nearly all of his life. He owns shares of General Electric. Wal-Mart and Microsoft are Motley Fool Inside Value picks. The Fool owns shares of Procter & Gamble. Try any of our Foolish newsletter services free for 30 days. The Fool's disclosure policy makes you No. 1.