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SCI Engineered Materials (SCIA) 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. SCI Engineered Materials disclosed 29 risk factors in its most recent earnings report. SCI Engineered Materials reported the most risks in the “Finance & Corporate” category.

Risk Overview Q2, 2026

Risk Distribution
29Risks
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

SCI Engineered Materials disclosed risks per quarterNo. of Risks2829303132Q3Q4Q12023Q2Q3Q4Q12024Q2Q3Q4Q12025Q2Q3Q4Q12026Q2Showing: Q4, 2025
Risks removedRisks addedRisks changedSCI Engineered Materials Risk Factors
  • Accounting & Financial Operations - Risk 1
    We have not paid dividends on our common stock in the past and do not expect to do so in the foreseeable future. past.

    We have never declared or paid cash dividends on our shares of common stock. While it is possible that we may pay a cash dividend in the future, we currently intend to use future earnings for the growth of our business. As a result, investors must currently rely on sales of the common stock based on price appreciation, which may or may not occur, as the best way to realize future gains on their investments.

Read and Evaluate the RiskReserved for Ultimate MembersUpgrade
Legal & Regulatory (1)

Risk Highlights Q2, 2026

Main Risk Category
Finance & Corporate
With 8 Risks
Number of Disclosed Risks
29
No changes from last report
S&P 500 Average: 32
Recent Changes
0Risks added
0Risks removed
0Risks changed
Since Jun 2026
Number of Risk Changed
0
No changes from last report
S&P 500 Average: 1

Risk Word Cloud

we are subject to anti-corruption laws in the jurisdictions in which we may operate, including anti-corruption laws of china and the federal corrupt practices act (fcpa). our failure to comply with these laws could result in penalties which could harm our reputation and have a material adverse effect on our business, results of operations and financial condition.federal corrupt practices actour common stock has been subject to the securities and exchange commission's "penny stock" regulations, which may limit the liquidity of common stock held by our shareholders.liquidity of common stock heldadditional development of our products may be necessary due to uncertainty regarding the development of markets.additional development of our productswe are subject to anti-corruption laws in the jurisdictions in which we may operate, including anti-corruption laws of china and the federal corrupt practices act (fcpa). our failure to comply with these laws could result in penalties which could harm our reputation and have a material adverse effect on our business, results of operations and financial condition.subject to anti-corruption lawschanges in the strategies of key trade customers may adversely affect our business.strategies of key trade customerswe are subject to anti-corruption laws in the jurisdictions in which we may operate, including anti-corruption laws of china and the federal corrupt practices act (fcpa). our failure to comply with these laws could result in penalties which could harm our reputation and have a material adverse effect on our business, results of operations and financial condition.including anti-corruption laws of chinaregulation from the dodd-frank wall street reform and consumer protection act (the "dodd-frank act") could adversely affect our business or financial results.dodd-frank wall street reformprovisions in our articles of incorporation and code of regulations provide for indemnification of officers and directors which could require us to divert funds away from our business and operations.require us to divert fundsa substantial portion of our sales have been dependent upon certain principal customers, the loss of whom could materially negatively affect the company's total revenue.substantial portion of our salesour property is subject to risks from natural disasters such as earthquakes and severe weather, and other potential risks associated with the effects of climate change.effects of climate change

Risk Factors Full Breakdown - Total Risks 29

Share Price & Shareholder Rights4 | 13.8%
  • Share Price & Shareholder Rights - Risk 1
    Our common stock has been subject to the Securities and Exchange Commission's "penny stock" regulations, which may limit the liquidity of common stock held by our shareholders.

    Our common stock currently trades on the OTC Markets' OTCQB market under the symbol "SCIA." Based on a trading price often below $5 per share, our common stock is considered a "penny stock" for purposes of federal securities laws, and therefore has been subject to regulations, which affected the ability of broker-dealers to sell our securities. Broker-dealers who recommend a "penny stock" to persons (other than established customers and accredited investors) must make a special written suitability determination and receive the client's written agreement to a transaction prior to a purchase or sale. If penny stock regulations apply to our common stock, it may be difficult to trade the stock because compliance with the regulations can delay and/or preclude certain trading transactions. Broker-dealers may be discouraged from effecting transactions in common stock because of the sales practice and disclosure requirements for penny stock. This could adversely affect the liquidity and/or price of our common stock and impede the sale of the common stock in the secondary market.

  • Share Price & Shareholder Rights - Risk 2
    The market for our common stock is limited, and as such our shareholders may have difficulty selling their shares when desired or at attractive market prices.

    Our stock price, trading volume, and market listing may make it more difficult for shareholders to sell shares when desired or at attractive prices. In 2001, our stock began trading on The Over-the-Counter Bulletin Board, which is now known as the OTC Markets. Our common stock trades in low volumes and at low prices. Some investors view low-priced stocks as unduly speculative and therefore not appropriate candidates for investment. Many institutional investors have internal policies prohibiting the purchase or maintenance of positions in low-priced stocks. This has the effect of limiting the pool of potential purchases of our common stock at present price levels. Shareholders may find greater percentage spreads between bid and asked prices, and more difficulty in completing transactions and higher transaction costs when buying or selling our common stock than they would if our stock were listed on a major stock exchange.

  • Share Price & Shareholder Rights - Risk 3
    Takeover defense provisions in Ohio law and our corporate governance documents may delay or prevent takeover attempts preventing our shareholders from realizing a premium on their stock.

    Various provisions of Ohio corporation laws as well as our corporate governance documents may inhibit changes in control not approved by our Board of Directors and may have the effect of depriving our investors of an opportunity to receive a premium over the prevailing market price of our common stock in the event of an attempted hostile takeover. In addition, the existence of these provisions may adversely affect the market price of our common stock. These provisions include: - A requirement that a special meeting of the shareholders must be called by our Board of Directors, Chairperson, the President, or the holders of shares with voting powers of at least fifty percent (50%). - Advanced notice requirements for shareholder proposals and nominations. - The availability of "blank check preferred stock." Our Board of Directors can use these and other provisions to prevent, delay or discourage a change in control of the company or a change in our management. Any such delay or prevention of a change in control of management could deter potential acquirers or prevent the completion of a takeover transaction to which our shareholders could receive a substantial premium over the current market price of our common stock, which may in turn limit the price investors might be willing to pay for our common stock.

  • Share Price & Shareholder Rights - Risk 4
    Our Articles of Incorporation authorize us to issue additional shares of stock.

    The Company is authorized to issue up to 15,000,000 shares of common stock. The Board of Directors may approve the issuance of common stock as they consider sufficient without seeking shareholder approval. As of December 31, 2025, we had 4,483,407 shares outstanding and no shares underlying options that are currently exercisable resulting in 10,416,593 shares of common stock available for issue. We purchased 100,000 shares of SCI's common stock in December 2025 pursuant to a share repurchase program. The issuance of additional shares of common stock in the future may reduce the proportionate ownership and voting power of current shareholders. Our Articles of Incorporation authorize us to issue up to 260,000 shares of Preferred Stock. The issuance of preferred stock in the future could create additional securities which would have dividend and liquidation preferences prior to the outstanding shares of common stock. These provisions could also impede a non-negotiated change in control. As of December 31, 2025, there were no preferred shares outstanding.

Accounting & Financial Operations2 | 6.9%
Debt & Financing2 | 6.9%

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.