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Northwest Pipe Company (NWPX) 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. Northwest Pipe Company disclosed 27 risk factors in its most recent earnings report. Northwest Pipe Company reported the most risks in the “Finance & Corporate” category.

Risk Overview Q3, 2021

Risk Distribution
27Risks
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 changedNorthwest Pipe Company Risk Factors
Risk Changed (1)Risk Removed (1)
  • Accounting & Financial Operations - Risk 1
    Material weaknesses in our internal controls could have a material adverse effect on our business.

    If in the future we identify one or more material weaknesses in our internal control over financial reporting, we will be unable to assert that our internal control over financial reporting is effective. Furthermore, we cannot assure you that there will not be material weaknesses or significant deficiencies in our internal control over financial reporting in the future. Any failure to maintain internal control over financial reporting could severely inhibit our ability to accurately report our financial condition, results of operations or cash flows. If our independent registered public accounting firm determines we have a material weakness or significant deficiency in our internal control over financial reporting, we could lose investor confidence in the accuracy and completeness of our financial reports, the market price of our common stock could decline, and we could be subject to sanctions or investigations by Nasdaq, the SEC, or other regulatory authorities. Failure to remedy any material weakness in our internal control over financial reporting, or to implement or maintain other effective control systems required of public companies, could also restrict our future access to the capital markets.

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Macro & Political (1)

Risk Highlights Q3, 2021

Main Risk Category
Finance & Corporate
With 13 Risks
Number of Disclosed Risks
27
No changes from last report
S&P 500 Average: 32
Recent Changes
0Risks added
0Risks removed
0Risks changed
Since Sep 2021
Number of Risk Changed
0
No changes from last report
S&P 500 Average: 1

Risk Word Cloud

we are subject to stringent environmental, health, and safety laws, which may require us to incur substantial compliance and remediation costs, thereby reducing our profits.subject to stringent environmentalwe will need to substantially increase working capital if market conditions and customer order levels improve.customer order levels improveour quarterly results of operations are subject to significant fluctuation.our quarterly results of operationsfailure to implement internal controls at acquired companies could increase risk of material weaknesses.failure to implement internal controlscertain provisions of our governing documents and oregon law could discourage potential acquisition proposals.provisions of our governing documentswe will need to substantially increase working capital if market conditions and customer order levels improve.to substantially increase working capitalour business faces an overcapacity situation due to recent capacity expansions as well as the potential for increased competition from substitute products from manufacturers of concrete pressure pipe, ductile iron, polyvinyl chloride ("pvc"), and highdensity polyethylene pipe.manufacturers of concrete pressure pipefailure to implement internal controls at acquired companies could increase risk of material weaknesses.increase risk of material weaknessesproject delays in public water transmission projects could adversely affect our business.public water transmission projectsour quarterly results of operations are subject to significant fluctuation.subject to significant fluctuation

Risk Factors Full Breakdown - Total Risks 27

Share Price & Shareholder Rights3 | 11.1%
  • Share Price & Shareholder Rights - Risk 1
    The relatively low trading volume of our common stock may limit your ability to sell your shares.

    Although our shares of common stock are listed on the Nasdaq Global Select Market ("Nasdaq"), we have historically experienced a relatively low trading volume. If we have a low trading volume in the future, holders of our shares may have difficulty selling a large number of shares of our common stock in the manner or at a price that might otherwise be attainable.

  • Share Price & Shareholder Rights - Risk 2
    The market price of our common stock could be subject to significant fluctuations.

    The market price of our common stock has experienced, and may continue to experience, significant volatility. Among the factors that could affect our stock price are: - our operating and financial performance and prospects;- quarterly variations in the rate of growth of our financial indicators, such as earnings per share, net income, and net sales;- changes in revenue or earnings estimates or publication of research reports by analysts;- loss of any member of our senior management team;- speculation in the press or investment community;- strategic actions by us or our competitors, such as acquisitions or restructuring;- sales of our common stock by shareholders;- relatively low trading volume;- general market conditions and market expectations for our industry and the financial health of our customers; and - domestic and international economic, legal, and regulatory factors unrelated to our performance. The stock markets in general have experienced broad fluctuations that have often been unrelated to the operating performance of particular companies. These broad market fluctuations may adversely affect the trading price of our common stock.

  • Share Price & Shareholder Rights - Risk 3
    Certain provisions of our governing documents and Oregon law could discourage potential acquisition proposals.

    Our articles of incorporation contain provisions that: - classify the board of directors into three classes, each of which serves for a three-year term with one class elected each year;- provide that directors may be removed by shareholders only for cause and only upon the affirmative vote of 75% of the outstanding shares of common stock; and - permit the board of directors to issue preferred stock in one or more series, fix the number of shares constituting any such series, and determine the voting powers and all other rights and preferences of any such series, without any further vote or action by our shareholders. In addition, we are subject to certain provisions of the Oregon Business Corporation Act that could discourage potential acquisition proposals, could deter, delay, or prevent a change in control that our shareholders consider favorable, and could depress the market value of our common stock. Additional information regarding the above described provisions of our governing documents and the Oregon Business Corporation Act is set forth in the "Description of Securities Registered Under Section 12 of the Securities Exchange Act of 1934" filed as Exhibit 4.2 to our 2019 Form 10-K, which was filed with the SEC on March 3, 2020.

Accounting & Financial Operations6 | 22.2%
Debt & Financing3 | 11.1%
Corporate Activity and Growth1 | 3.7%

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.