initial public offering (IPO)



First offering of a firms' stock (shares) on the stockmarket, at the time it 'goes public.' Because a stockmarket usually values the stock on the expectations of the firm's future growth and income, IPOs are typically an opportunity for the founders and other early investors to make high profits by cashing their stockholdings.

Use this term in a sentence

  • If you know of a new company that you think will succeed you may want to take a chance on its initial public offering.

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  • The initial public offering for the stock was really high and that made everyone pay closer attention to what happened next.

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  • If your company is about to go on the market then you need to hope many people take up your initial public offering.

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