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Radware (RDWR) 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. Radware disclosed 43 risk factors in its most recent earnings report. Radware reported the most risks in the “Tech & Innovation” category.

Risk Overview Q4, 2019

Risk Distribution
43Risks
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 changedRadware Risk Factors
New Risk (3)
  • Share Price & Shareholder Rights - Risk 1
    Our share price has been volatile in the past and may be subject to volatility in the future.

    The market price for our ordinary shares, as well as the prices of shares of other technology companies, has been volatile. For example, during 2019 the lowest closing price of our share was $22.01, compared to the highest closing price of our share of $26.75 during the same year. The volatility of our share price may have a negative impact on our financial performance as a result of its negative impact on employee retention. Numerous factors, many of which are beyond our control, may cause the market price and trading volume of our ordinary shares to fluctuate significantly and further decrease, including: lower than expected operating results from levels forecasted by securities analysts;announcements concerning us or our competitors;the introduction of new products and new industry standards;general market conditions and changes in market conditions in our industry;the general state of the securities market (particularly the technology sector);political, economic and other developments in the State of Israel, the U.S. and worldwide, including, for example, the recent COVID-19 outbreak; and any of the events underlying any of the other risks or uncertainties set forth elsewhere in this annual report actually occurs.

Read and Evaluate the RiskReserved for Ultimate MembersUpgrade
Tech & Innovation (3)
Legal & Regulatory (1)
Production (1)
Ability to Sell (3)
Macro & Political (1)

Risk Highlights Q4, 2019

Main Risk Category
Tech & Innovation
With 11 Risks
Number of Disclosed Risks
43
-1
From last report
S&P 500 Average: 32
Recent Changes
3Risks added
4Risks removed
10Risks changed
Since Dec 2019
Number of Risk Changed
10
No changes from last report
S&P 500 Average: 1

Risk Word Cloud

provisions of our articles of association and israeli law as well as the terms of our equity incentive plan could delay, prevent or make a change of control of us more difficult or costly, which could depress the price of our ordinary shares.change of control of usour global operations may expose us to additional risksexpose us to additional risksgovernment regulations affecting our business are evolving, and unfavorable changes could harm our business.government regulations affecting our businesswe have obtained benefits from the israeli innovation authority, which subjects us to ongoing restrictions. in addition, these benefits may not continue or in the future may be limited or restricted.subjects us to ongoing restrictionswe must manage our anticipated growth effectively in order to be profitable.manage our anticipated growth effectivelyif our products fail to protect against malicious attacks and our end-users experience security breaches, our reputation and business could be harmed, and our operating results could be adversely impacted.our end-users experience security breachesan increasing amount of intangible assets and goodwill on our books may in the future lead to significant impairment charges.increasing amount of intangible assetsa shortage of components or manufacturing capacity could cause a delay in our ability to fulfill orders or increase our manufacturing costs.our ability to fulfill ordersthe adoption of the tax reform and the enactment of additional legislation changing the united states taxation of international business activities could materially impact our financial position and results of operations.materially impact our financial positionthe adoption of the tax reform and the enactment of additional legislation changing the united states taxation of international business activities could materially impact our financial position and results of operations.enactment of additional legislation changing

Risk Factors Full Breakdown - Total Risks 43

Innovation / R&D2 | 4.7%
  • Innovation / R&D - Risk 1Added
    We must develop new solutions and enhance existing solutions to remain competitive.

    The market for cyber security and application delivery solutions is characterized by rapid technological changes, driven primarily by changes in customer needs and requirements, an evolving cyber threats landscape, changes in application infrastructure tools and increasingly demanding compliance mandates. For example, some of the challenges we face include: developing more powerful platforms for our products, as our products typically constitute a critical portion of our customers' data centers and the capacity of data centers to facilitate transactions on their servers has been steadily increasing;adapting to fundamental changes in our customers' data centers' infrastructure and changes in the locations of applications and data by offering relevant solutions for multi-cloud and hybrid cloud environments, microservices topologies and Kubernetes;adapting to changes in the cyber threat landscape, such as application level attacks, encrypted attacks and automated attacks;developing and enhancing our cloud and virtual offerings and expanding our managed security services capabilities to address the industry trend of providing services through the cloud; and increasing our support offerings to address the industry trend of increased customer reliance on third party-provided managed information technology, or IT, services. In order to meet these challenges and remain competitive in the market, we have introduced, and must continue to introduce, new solutions and enhancements to our existing solutions. Accordingly, our future success will depend, to a substantial extent, on our ability to accurately and timely identify market trends and needs; on our ability to invest in research and development and timely develop, introduce and support relevant and desired new solutions and enhancements; and on our ability to gain market acceptance of our offerings. There can be no assurances that our continued investment in research and development, including associated capital expenditures, will ultimately allow us to remain competitive in our industry or otherwise result in successful solutions that generate the expected sales and support our growth. In addition, diversifying our solution portfolio might expose us to direct competition with new players and might require additional investments in the associated sales and marketing practices. If our research and development efforts do not lead to a corresponding increase in our revenues, if we fail to timely develop and deploy new solutions and enhancements to our existing solutions, or if we fail to gain market acceptance of our new solutions or enhanced solutions, our business, operating results and financial condition could be materially adversely affected.

  • Innovation / R&D - Risk 2Changed
    If the market for our cloud-based solutions does not continue to develop and grow, we may incur capital and operation losses.

    As we continue to expand our cloud-based solution offerings, our investments, both capital and operational, in our cloud business increase. We cannot assure you that sales of our cloud-based solutions will continue to develop and grow. In addition, we cannot assure you that our services and technology will keep pace with the changes in this market. Specifically, the emergence of alternative solutions, such as those offered by Amazon AWS, Microsoft Azure or Google public cloud, may negatively affect sales of our solutions.

Trade Secrets1 | 2.3%
Cyber Security2 | 4.7%
Technology6 | 14.0%

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.