Overcapitalize (Verb)
Meaning 1
Overestimate the market value of; "overcapitalize a property".
Classification
Verbs of thinking, judging, analyzing, doubting.
Examples
- The bank refused to lend the full amount requested to buy the house, as they suspected the buyer was trying to overcapitalize a property that was already heavily mortgaged.
- The housing expert advised the homeowner to avoid overcapitalizing by installing low-cost, energy-efficient features that would appeal to a wider range of buyers.
- Home renovation TV shows often overcapitalize properties by installing lavish kitchens and master suites, which may not be feasible for the average homeowner.
- After reviewing the property assessment, the appraiser concluded that the owners had overcapitalized their home with excessive upgrades that did not match the neighborhood's standards.
- Regional economic forecasts warned that the boomtown's reliance on the mining industry would eventually lead to an overcapitalization of its infrastructure, making it difficult for residents and businesses to afford.
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Meaning 2
Capitalize beyond what the business or the profit-making prospects warrant.
Classification
Verbs of size, temperature change, intensifying, etc..
Examples
- The company decided not to overcapitalize on the trendy restaurant idea, citing concerns that the fad would soon pass.
- Many startups overcapitalize on flashy marketing gimmicks rather than focusing on genuine product development.
- Investors were cautious not to overcapitalize on the tech firm, given the volatility of the market and the competitive landscape.
- Despite the optimistic predictions, the business owners chose not to overcapitalize on the new product line, instead opting for a more measured approach.
- Some entrepreneurs tend to overcapitalize on unproven business models, which can lead to financial difficulties down the line.
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Meaning 3
Estimate the capital value of (a company) at an unreasonably or unlawfully high level.
Classification
Verbs of thinking, judging, analyzing, doubting.
Examples
- The company was fined for trying to overcapitalize its shares by claiming false assets and inflated revenues in their annual financial report.
- Auditors accused the CEO of attempting to overcapitalize the company's valuation in order to secure a large buyout from investors.
- The accountant was found guilty of overstating the company's profit margins in an effort to overcapitalize its shares and sell them to unsuspecting investors.
- The investigation into the company's financial records discovered several instances where executives had tried to overcapitalize its assets to secure large loans from banks.
- Securities regulators were suspicious of the company's rapid growth and began to investigate whether they were attempting to overcapitalize their shares to secure more funding from investors.