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What Do SemiLEDs’ Risk Factors Tell Investors?

SemiLEDs (LEDS) develops, manufactures, and sells LED chips and LED components for general lighting and specialty industrial applications.

Let’s take a look at what has changed in its key risk factors that investors should know, along with its financial performance.

According to the new Tipranks Risk Factors tool, SemiLEDs’ main risk category is Finance & Corporate, which accounts for 33% of the total 54 risks identified. The next three major risk factor contributors are Tech & Innovation, Production, and Ability to Sell at 15% each. Since May, the company has changed one key risk factor under the Finance & Corporate category.

The company acknowledges that its share price and trading volume may continue to witness extreme volatility, which may cause substantial losses to investors.

So far in 2021, SemiLEDs share price ranged between $3.07 and $25.8. Daily trading volume has fluctuated from 20,321 to 159.2 million. SemiLEDs notes that these gyrations are unrelated to its underlying business or industry environment and may be the result of investor interest stemming from social media and online forums, which creates risks for investors.

In its Q3 2021 results, the company reported that net revenues dropped to $1.4 million from $1.6 million a year ago. Further, relatively flat operating expenses helped SemiLEDs narrow its net loss to $64 thousand against $513 thousand a year ago.

In light of the present uncertainty from COVID-19 impact on business and the economy, SemiLEDs did not provide any guidance for Q4. (See SemiLEDs stock chart on TipRanks)

The Finance & Corporate risk factor’s sector average is at 37%, compared to SemiLEDs’ 33%. Shares are up 242.4% over the past year.

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