Listing requirements and what they mean

In order to be eligible for a major stock exchange like Nasdaq, a company has to be in line with certain listing requirements. Companies who have been run well, have steady revenue, larger market caps and strong cash flow are the companies that make it onto a public stock exchange like Nasdaq. Let’s take a look at what a company needs to do to achieve the requirements. (1)U.S. Securities and Exchange Commission (SEC)."Marketplace Rules, Listing Requirements for Nasdaq Securities."

Listing requirements: what companies need to adhere to

So, in order to have a company listed on a reputable market like Nasdaq, the company needs to fulfil at least 1 of 4 listing requirements. Firstly, a company needs to at least have a $4 bid price value for its stock. In addition to this, the company needs to have at least 3 market makers for its stock. (2)Nasdaq."Initial Listing Guide,"

At the end of the day, companies will need to pay significant fees based on factors like the size of the company and the type of security that they are listing on the public market. Depending on these variables the company could be made to pay an application fee ranging from $5,000 to $25,000. The companies will then need to pay an additional fee based on the number of shares that they have issued. This fee can range between $100,000 and $150,000. 

A company will need to achieve certain minimum requirements when it comes to shareholders and the number of publicly traded shares as well. For instance, a company will need to have a minimum of 1,250,000 publicly traded shares listed, at least 450 round lot shareholders, 2,200 total shareholders or 550 shareholders with 1.1 million average trading volume over a period of no less than 12 months.

Additional financial standards

Aside from the above requirements we touched on, companies need to meet other certain financial standards as well. 

No.1: Earnings

In order to be considered for a major exchange like Nasdaq, companies will need to have achieved pre-tax earnings of at least $11 million in the last 3 years, $2.2 million in the last 2 years and at no point in those years could they have ended with a net loss. 

No.2: Cash flow

In the previous 3 years of the company, there needs to have been a minimum cash flow of at least $27.5 million and at no point could there have been a negative cash flow. Total revenue over the past year needs to hit a minimum of $110 and the market capitalization of the company over the past 12 months needs to be at the minimum, $550 million. 

No.3: Total assets

A company can earn leeway on their overall cash flow and market capitalization, provided they achieve a certain level of asset value. Cash flow requirements can be cut down to $160 million if a company’s total asset value amounts to at least $80 million. 

No.4: Total capital

Another way to remove the overall cash flow requirements for a company is by having solid market capitalization over a 12 month period. If a company hits at least $850 million in market cap over 12 months and their revenues for the year at least $90 million, their cash flow requirements are removed entirely. 


Stockwire Inc. does not hold a position in the securities and/or financial instrument(s) mentioned herein, has not received any compensation, whether in securities or monetary form, for the content of this publication by any company mentioned herein and does not stand to benefit from any volume generated by this publication. Stockwire Inc. and its authors do not provide investment advice or recommendations regarding the purchase or sale of any securities. Investors are responsible for their own investment decisions. Any information, opinions or views provided in this document, including hyperlinks to the Stockwire website or the websites of its affiliates or third parties, are for your general information only, and are not intended to provide legal, investment, financial, accounting, tax or other professional advice. While information presented is believed to be factual and current, its accuracy is not guaranteed and it should not be regarded as a complete analysis of the subjects discussed. All expressions of opinion reflect the judgment of the author(s) as of the date of publication and are subject to change. No endorsement of any third parties or their advice, opinions, information, products or services is expressly given or implied by Stockwire Inc. or its affiliates. You should conduct your own research and consult with your qualified advisor before taking any action based upon the information contained in this document. Stockwire Inc. and its affiliates do not accept any liability for any for any investment decisions made based on the information provided in this document.

Furthermore, the products, services and securities referred to in this publication are only available in Canada and other jurisdictions where they may be legally offered for sale. If you are not currently a resident of Canada, you should not access the information available on the Stockwire Inc. website.

For more information on our terms and conditions of use, please see and and