Capital stock is the number of common and preferred shares that a company is authorized to issue, and is recorded in shareholders' equity. Capital stock is the total amount of shares a company is authorized to issue, while treasury stock is the number of shares a company holds in its treasury.It is usually issued when companies are trying to fund their growth. The meaning of capital stock indicates that companies issue shares to raise capital in exchange for an ownership stake in the company. Common stock is a representation of partial ownership in a company and is the type of stock in which most people invest. Capital stock authorized is the number of shares of stock that a corporation is entitled to issue as designated in its charter.