What are the NASDAQ listing requirements?

The major stock exchanges, like the Nasdaq, are specialized clubs that have a reputation for the companies. They trade with As such, Nasdaq will not allow any company to trade on its exchange. Only companies with a solid history and a high level of management are considered.

There are four sets of Nasdaq listing requirements. Each company must meet at least one of the four required sets, as well as the basic principles of all companies.

Key takeaways.

The stock major stock exchanges, like the Nasdaq, are specialized clubs – they have a reputation for the companies they trade with.

NASDAQ has four sets of listing requirements.

Each company must meet at least one of the four required sets. As well as the basic principles of all companies

requirements In addition to these requirements, companies must meet all standards under at least one of the following standards.

A company has four ways to get listed on the NASDAQ, depending on the company’s core principles.

Requirements list for all companies.

Each company must have at least 1,250,000 publicly traded shares at the time of listing. Excluding those held by officers, directors, or any beneficial owners of more than 10% of the company. ۔

The regular bid price of the company’s stock at the time of listing must be at least 00 4.00. However, a company may be eligible for a 3.00 or $ 2.00 closing price option if the company meets different requirements.

There must be at least three (or four criteria-based) market makers for the stock. For companies using the $ 3 or $ 2 standard, only two market makers may be needed. Each listing firm must also comply with NASDAQ Corporate Governance Rules 4350, 4351, and 4360.

Companies will have at least 450 round lots (ie 100 shares or more) of shareholders, 2,200 total shareholders. Or 550 total shareholders with an average trading volume of 1.1 million.

By 2020, a company will have to pay an application fee of $ 25,000 before its stock is even considered for listing, and if successful, it will have to pay an entry fee of between $ 150,000 and $ 295,000. Can expect.

In addition to these requirements, companies must meet all standards under at least one of the following standards.

Standard 1: Earnings.

The company has suffered a net loss of at least $ 11 million, at least 2 2.2 million in the last two years, and not a single year in the last three years.

Standard 2: Capitalization with Cash Flow.

The company must have a total cash flow of at least $ 27.5 million in the last three financial years, with no negative cash flow in any of these three years. Also, its average market capitalization should be at least $ 550 million in the last 12 months, and at least $ 110 million in the last fiscal year.

Standard 3: Investing with income.

Companies can be excluded from the need for a second standard of cash flow if they have an average market capitalization of at least 8 850 million in the last 12 months and revenue of at least 90 90 million in the previous fiscal year.

Standard 4: Assets with equity.

Companies can eliminate cash flow and revenue requirements, and reduce their marketing capitalization requirements to 160 160 million if their total assets are at least $ 80 million and their stock market holders’ equity is at least 80 million. Less than $ 55 million.

Bottom line

A company has four ways to get listed on the NASDAQ, depending on the company’s fundamentals. If a company does not meet certain criteria, such as minimum operating income, it has to make it to a minimum in another area, such as revenue. This helps in improving the quality of companies listed on the exchange.

Once a company enters the market, it must maintain certain standards in order to continue trading. Failure to meet the specifications set by the stock exchange will result in dismissal. Falling below the minimum required share price, or market capitalization is one of the key factors that trigger delisting. The exact details of the deletion depend on the exchange.