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DriveItAway Holdings (DWAY) Risk Analysis

Public companies are required to disclose risks that can affect the business and impact the stock. These disclosures are known as “Risk Factors”. Companies disclose these risks in their yearly (Form 10-K), quarterly earnings (Form 10-Q), or “foreign private issuer” reports (Form 20-F). Risk factors show the challenges a company faces. Investors can consider the worst-case scenarios before making an investment. TipRanks’ Risk Analysis categorizes risks based on proprietary classification algorithms and machine learning. DriveItAway Holdings disclosed 25 risk factors in its most recent earnings report. DriveItAway Holdings reported the most risks in the “Finance & Corporate” category.

Risk Overview Q4, 2021

Source: the company's latest filing for the period ended Dec 31, 2021, filed Feb 22, 2022

Risk Distribution
25Risks
Sector Avg.Finance & CorporateTech & InnovationLegal & RegulatoryProductionAbility to SellMacro & Political
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Risk Change Over Time

No filing history is available.

Risks removedRisks addedRisks changedDriveItAway Holdings Risk Factors
New Risk (1)
  • Accounting & Financial Operations - Risk 1
    Our recorded revenues increased decreased in fiscal year 2020 2021 as compared to fiscal year 2019 2020

    Our reported revenues decreased significantly in fiscal year 2021 to approximately $2,195,000 from $3,038,000 in the prior year, a decrease of approximately $843,000 or 28%, The primary cause of the decrease in royalties and technology fees was due to the fewer franchises paying royalties and technology fees as a result of the termination of non-performing franchisees from the system, and the interruption of normal operation at remaining franchises because of the COVID-19 pandemic. Also, due to the impact of the COVID-19 pandemic on the business of our franchisees, we voluntarily elected to cease pursuing collections of our marketing fees from our franchisees in March 2020, which continued for all of fiscal 2021. While the company experienced no master franchise sales, through a series of cost cutting measures, the Company was able to generate a profit in all four quarters of the reporting year. Should we begin to incur losses or be unable to reverse its decline in revenues, our ability to attract new franchisees and maintain positive working relationships with our current franchisees may be impaired. In addition, if we incur losses, we may need to seek additional financing which could be dilutive to our stockholders.

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Risk Highlights Q4, 2021

Main Risk Category
Finance & Corporate
With 12 Risks
Number of Disclosed Risks
25
No changes from last report
S&P 500 Average: 32
Recent Changes
0Risks added
0Risks removed
0Risks changed
Since Dec 2021
Number of Risk Changed
0
-1
From last report
S&P 500 Average: 1

Risk Word Cloud

our future growth could place strains on our management, employees, information systems and internal controls, which may adversely impact our business.adversely impact our businessour success depends substantially on the value of our brand.our success depends substantiallycompliance with the sarbanes-oxley act of 2002 will require substantial financial and management resources.sarbanes-oxley act of 2002the recent covid-19 outbreak has been declared a pandemic by the world health organization, has spread to the united states and many other parts of the world and has adversely affected our business operations, employee availability, financial condition, liquidity and cash flow and the length of such impacts are uncertain.adversely affected our business operationswe could be subject to changes in tax rates, the adoption of new u.s. or international tax legislation or exposure to additional tax liabilities.exposure to additional tax liabilitieswe may face intellectual property infringement claims that could be time-consuming, costly to defend and result in its loss of significant rights.face intellectual property infringement claimsthe concentration of our capital stock ownership with insiders will likely limit your ability to influence corporate matters.ability to influence corporate matterswe are subject to a variety of additional risks associated with our franchisees.variety of additional risksthe markets for our services are competitive, and we may be unable to compete successfully.unable to compete successfullywe rely upon trademark, copyright and trade secret laws and contractual restrictions to protect our proprietary rights, and if these rights are not sufficiently protected, our ability to compete and generate revenues could be harmed.our ability to compete

Risk Factors Full Breakdown - Total Risks 25

Share Price & Shareholder Rights3 | 12.0%
  • Share Price & Shareholder Rights - Risk 1
    The concentration of our capital stock ownership with insiders will likely limit your ability to influence corporate matters.

    As of December 31, 2021, our executive officers, directors, significant shareholders and affiliated persons and entities, collectively, beneficially owned approximately 38.5% of our outstanding common stock. If the Share Exchange and the disposition of our Learning Business occurs, we project that officers, directors, significant shareholders and affiliated persons and entities will, through a new series of preferred stock, control in excess of 80% of the votes on any matter that requires the approval of our stockholders. As a result, these persons and entities have the ability to exercise control over most matters that require approval by our stockholders, including the election of directors and approval of significant corporate transactions. Corporate action might be taken even if other stockholders oppose them. This concentration of ownership might also have the effect of delaying or preventing a change in control of our company that other stockholders may view as beneficial.

  • Share Price & Shareholder Rights - Risk 2
    We currently are eligible to deregister our Common Stock from SEC reporting requirements.

    Upon filing this Form 10-K and Form 10-Q for the subsequent quarter, we will be eligible to deregister our securities from the reporting requirements of the Securities Exchange Act of 1934, as amended as we currently have less than 300 shareholders of record and our Common Stock is not listed on a stock exchange. If our Common Stock is deregistered, it may be more difficult to receive information of the Company which could affect the liquidity of our Common Stock.

  • Share Price & Shareholder Rights - Risk 3
    Provisions in our charter documents and Delaware law may discourage or delay an acquisition that stockholders may consider favorable, which could decrease the value of our common stock.

    Our certificate of incorporation, our bylaws, and Delaware corporate law contain provisions that could make it harder for a third party to acquire us without the consent of our board of directors (the "Board"). These provisions include those that: authorize the issuance of up to 10,000,000 shares of preferred stock in one or more series without a stockholder vote. In addition, in certain circumstances, Delaware law also imposes restrictions on mergers and other business combinations between us and any holder of 15% or more of our outstanding common stock, though we are not currently subject to this limitation because our Common Stock is not listed on a national securities exchange and we have less than 2,000 stockholders of record.

Accounting & Financial Operations4 | 16.0%
Debt & Financing2 | 8.0%
Corporate Activity and Growth3 | 12.0%

See a full breakdown of risk according to category and subcategory. The list starts with the category with the most risk. Click on subcategories to read relevant extracts from the most recent report.

FAQ

What are “Risk Factors”?
Risk factors are any situations or occurrences that could make investing in a company risky. The Securities and Exchange Commission (SEC) requires that publicly traded companies disclose their most significant risk factors. This is so that potential investors can consider any risks before they make an investment. They also offer companies protection, as a company can use risk factors as liability protection. This could happen if a company underperforms and investors take legal action as a result. It is worth noting that smaller companies, that is those with a public float of under $75 million on the last business day, do not have to include risk factors in their 10-K and 10-Q forms, although some may choose to do so.
How do companies disclose their risk factors?
Publicly traded companies initially disclose their risk factors to the SEC through their S-1 filings as part of the IPO process. Additionally, companies must provide a complete list of risk factors in their Annual Reports (Form 10-K) or (Form 20-F) for “foreign private issuers”. Quarterly Reports also include a section on risk factors (Form 10-Q) where companies are only required to update any changes since the previous report. According to the SEC, risk factors should be reported concisely, logically and in “plain English” so investors can understand them.
How can I use TipRanks risk factors in my stock research?
Use the Risk Factors tab to get data about the risk factors of any company in which you are considering investing. You can easily see the most significant risks a company is facing. Additionally, you can find out which risk factors a company has added, removed or adjusted since its previous disclosure. You can also see how a company’s risk factors compare to others in its sector. Without reading company reports or participating in conference calls, you would most likely not have access to this sort of information, which is usually not included in press releases or other public announcements. A simplified analysis of risk factors is unique to TipRanks.
What are all the risk factor categories?
TipRanks has identified 6 major categories of risk factors and a number of subcategories for each. You can see how these categories are broken down in the list below. 1. Financial & Corporate Accounting & Financial Operations - risks related to accounting loss, value of intangible assets, financial statements, value of intangible assets, financial reporting, estimates, guidance, company profitability, dividends, fluctuating results. Share Price & Shareholder Rights – risks related to things that impact share prices and the rights of shareholders, including analyst ratings, major shareholder activity, trade volatility, liquidity of shares, anti-takeover provisions, international listing, dual listing. Debt & Financing – risks related to debt, funding, financing and interest rates, financial investments. Corporate Activity and Growth – risks related to restructuring, M&As, joint ventures, execution of corporate strategy, strategic alliances. 2. Legal & Regulatory Litigation and Legal Liabilities – risks related to litigation/ lawsuits against the company. Regulation – risks related to compliance, GDPR, and new legislation. Environmental / Social – risks related to environmental regulation and to data privacy. Taxation & Government Incentives – risks related to taxation and changes in government incentives. 3. Production Costs – risks related to costs of production including commodity prices, future contracts, inventory. Supply Chain – risks related to the company’s suppliers. Manufacturing – risks related to the company’s manufacturing process including product quality and product recalls. Human Capital – risks related to recruitment, training and retention of key employees, employee relationships & unions labor disputes, pension, and post retirement benefits, medical, health and welfare benefits, employee misconduct, employee litigation. 4. Technology & Innovation Innovation / R&D – risks related to innovation and new product development. Technology – risks related to the company’s reliance on technology. Cyber Security – risks related to securing the company’s digital assets and from cyber attacks. Trade Secrets & Patents – risks related to the company’s ability to protect its intellectual property and to infringement claims against the company as well as piracy and unlicensed copying. 5. Ability to Sell Demand – risks related to the demand of the company’s goods and services including seasonality, reliance on key customers. Competition – risks related to the company’s competition including substitutes. Sales & Marketing – risks related to sales, marketing, and distribution channels, pricing, and market penetration. Brand & Reputation – risks related to the company’s brand and reputation. 6. Macro & Political Economy & Political Environment – risks related to changes in economic and political conditions. Natural and Human Disruptions – risks related to catastrophes, floods, storms, terror, earthquakes, coronavirus pandemic/COVID-19. International Operations – risks related to the global nature of the company. Capital Markets – risks related to exchange rates and trade, cryptocurrency.