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Posted on: 9/08/2026
From the NASPP Blog – Cheap Stock Problems: What Triggers SEC Scrutiny
As companies value increases in the leadup to an IPO, they run the risk of being questioned about a cheap stock issue. This can draw considerable scrutiny from both the SEC and external auditors. This article breaks down what cheap stock issues are and the risks they carry, how they differ from 409A valuation issues, why they affect private companies the most, and how to stay ahead of the problem.
