A publicly traded entity is a company whose shares are regularly traded on one or more established securities markets, such as the NASDAQ or the New York Stock Exchange (NYSE). A company first goes public through an initial public offering (IPO).
Example Publicly Traded Company
Company ABC Inc. (the “Company”) is a privately held Delaware corporation with three shareholders: Bob, Jane, and John. In 2023, they decided to take the company public.
The Company files its Form S-1 (Registration of Securities) with the SEC and later lists 10,000,000 shares of Class A Common Stock on the NASDAQ with an open price of $2 per share.
The Company’s shares are now publicly traded on a globally recognized stock exchange.