Content analysis
?Positive | ||
Negative | ||
Uncertain | ||
Constraining | ||
Legalese | ||
Litigous | ||
Readability |
H.S. sophomore Avg
|
New words:
academic, admitting, affluence, AI, amplify, App, artificial, bridge, budget, chain, champion, CISO, citizen, cohesive, compliant, conferencing, controversial, Council, Dashboard, Database, decade, denying, disgorgement, downside, earliest, Esi, ethically, EVP, eWealthManager, eye, fall, filer, foreclose, harvesting, honor, instruction, intelligence, Kensington, kicked, kind, low, MarketCast, Michael, moderation, notably, OFAC, officially, outpace, penalty, percent, phase, pilot, posture, prejudgment, proactive, question, ready, reinforce, reopened, roadmap, robo, rooted, seamlessly, smoothly, societal, speculation, stable, stewardship, suboptimal, supply, sweep, testimony, TMS, today, tolerance, tripled, unlicensed, upheld, vendor, verification, video, vision, weather
Removed:
AG, agree, aspect, assistance, Branch, capitalization, caption, Cayman, circumvent, clear, closed, colleague, compose, connect, construct, constructing, construed, cooperating, decided, deepening, deeper, description, designation, discount, distinctive, driver, encounter, engender, engendered, estate, evade, expert, extending, extinguished, faster, FIRRMA, formulating, GuideMark, GuidePath, hedging, historically, hub, initially, initiative, line, main, Modernization, modernize, onboard, pandemic, put, ratably, recognizing, reflection, remained, rent, repaid, rounding, RSA, SEI, separate, sequentially, singular, smaller, stemming, study, subscale, Suisse, supplementary, surveyed, thereof, tightly, transitioned, unaudited, unified, WBI
Financial report summary
?Risks
- Our revenue may fluctuate from period to period, which could cause our share price to fluctuate.
- We operate in an intensely competitive industry, with many firms competing for business from financial advisers on the basis of the quality and breadth of investment solutions and services, ability to innovate, reputation and the prices of services, among other factors, and this competition could hurt our financial performance.
- We derive nearly all of our revenue from the delivery of investment solutions and services to clients in the financial advisory industry and our revenue could suffer if that industry experiences a downturn.
- Investors that pay us asset-based fees may seek to negotiate lower fees, choose to use lower-revenue products or cease using our services, which could limit the growth of our revenue or cause our revenue to decrease.
- Investors may redeem or withdraw their investment assets generally at any time. Significant changes in investing patterns or large-scale withdrawal of investment funds could have a material adverse effect on our results of operations, financial condition or business.
- Changes in market and economic conditions (including as a result of geopolitical conditions or events) could lower the value of assets on which we earn revenue, thereby negatively impacting our revenue, and could decrease the demand for our investment solutions and services.
- We must continue to introduce new investment solutions and services, and enhancements thereon, to address our clients’ changing needs, market changes and technological developments, and a failure to do so could have a material adverse effect on our results of operations, financial condition or business.
- We could face liability or incur costs to remediate operational errors or to address possible customer dissatisfaction.
- We may make future acquisitions which may be difficult to integrate, divert management resources, result in unanticipated costs or dilute our stockholders.
- We may be subject to liability for losses that result from a breach of our or a third party’s fiduciary duties.
- If our reputation is harmed, our results of operations, financial condition or business could be materially adversely affected.
- If our investment solutions and services fail to perform properly due to undetected errors or similar problems, our results of operations, financial condition or business could be materially adversely affected.
- Our failure to successfully execute the conversion of our clients’ assets from their existing platform to our platform in a timely and accurate manner could have a material adverse effect on our results of operations, financial condition or business.
- Our business relies heavily on computer equipment, electronic delivery systems and the Internet. Any failures, disruptions or other adverse impacts could result in reduced revenue and the loss of customers.
- If government regulation of the Internet changes, or if consumer attitudes towards the Internet change, we may need to change the manner in which we conduct our business or incur greater operating expenses.
- Inadequacy or disruption of our disaster recovery plans and procedures in the event of a catastrophe could adversely affect our business.
- We are reliant on our relationships with certain broker-dealers, strategists and enterprise clients, the loss of which could adversely affect our results of operations, financial condition or business.
- We are dependent on third-party service providers in our operations.
- We are dependent on third-party pricing services for the valuation of securities invested in our investment products.
- We rely on our executive officers and other key personnel.
- Executive officer, employee or third-party provider misconduct could expose us to significant legal liability and reputational harm.
- We may become subject to liability based on the use of our investment solutions and services by our clients.
- Lack of liquidity or access to capital could impair our business and financial condition.
- We may not be able to generate sufficient cash to service our indebtedness and may be forced to take other actions to satisfy our obligations under our 2022 Credit Agreement, which may not be successful.
- Restrictions in our existing and future debt agreements could limit our growth and our ability to engage in certain activities.
- We are a holding company and rely on dividends, distributions and other payments, advances and transfers of funds from our subsidiaries to meet our debt service and other obligations.
- Our controls and procedures may fail or be circumvented, our risk management policies and procedures may be inadequate and operational risks could adversely affect our reputation and financial condition.
- We could face liability related to our storage of personal information about our users.
- We could face liability for certain information we provide, including information based on data we obtain from other parties.
- We are exposed to data and cybersecurity risks that could result in data breaches, service interruptions, harm to our reputation, protracted and costly litigation or significant liability.
- If we are not able to satisfy data protection, security, privacy and other government- and industry-specific requirements or regulations, our results of operations, financial condition or business could be harmed.
- If third parties infringe upon our intellectual property or if we were to infringe upon the intellectual property of third parties, we may expend significant resources enforcing or defending our rights or suffer competitive injury.
- Confidentiality agreements with employees, consultants and others may not adequately prevent disclosure of trade secrets and other proprietary information.
- The use of “open source code” in investment solutions may expose us to additional risks and harm our intellectual property rights.
- Our controlling stockholder is subject to supervision by regulatory authorities in the PRC and must comply with certain PRC laws and regulations that may influence our controlling stockholder’s decisions relating to our business.
- Our controlling stockholder is required by the stock exchanges on which its shares are listed to disclose and obtain approval from its board of directors or shareholders for certain corporate actions that we undertake.
- The Committee on Foreign Investment in the United States (“CFIUS”) may modify, delay or prevent our future acquisition or investment activities.
- Changes in relations between the United States and the PRC, or in U.S. regulations concerning the PRC, may adversely impact our results of operations, financial condition or business, our ability to raise capital or the market price of our common stock.
- We are subject to extensive government regulation in the United States, and our failure or inability to comply with these regulations or regulatory action against us could adversely affect our results of operations, financial condition or business.
- Changes to the laws or regulations applicable to us or to our financial adviser clients could adversely affect our results of operations, financial condition or business.
- If we experience material weaknesses or otherwise fail to maintain an effective system of internal controls, we may not be able to accurately or timely report our financial condition or results of operations, which may adversely affect investor confidence in us and, as a result, the value of our common stock.
- Failure to comply with ERISA and Internal Revenue Code regulations could result in penalties against us.
- We are subject to litigation and regulatory examinations and investigations.
- Failure to properly disclose conflicts of interest could harm our reputation, results of operations or business.
- In the event of a change of control of our Company, we may be required to obtain regulatory approval and the consent of our advisory clients to the change of control, and any failure to obtain these consents could adversely affect our results of operations, financial condition or business.
- Control by our principal stockholder could adversely affect our other stockholders.
- Our stock price may be volatile, and the value of our common stock may decline.
- An active market for our common stock may not be sustained, which may inhibit the ability of our stockholders to sell shares of our common stock.
- Future sales of a substantial number of shares of our common stock in the public market could cause the price of our common stock to decline.
- We are a “controlled company” within the meaning of the NYSE listing standards and, as a result, qualify for, and intend to rely on, exemptions from certain corporate governance requirements. You will not have the same protections afforded to stockholders of companies that are subject to such requirements.
- We are an “emerging growth company” and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies has or will make our common stock less attractive to investors.
- The requirements of being a public company may strain our resources and distract our management, which could make it difficult to manage our business, particularly after we are no longer an “emerging growth company.”
- Some provisions of Delaware law and our Certificate of Incorporation and bylaws may deter third parties from acquiring us.
- Delaware law may delay or prevent a change in control, and may discourage bids for our common stock at a premium over its market price.
- Our Certificate of Incorporation designates the Court of Chancery of the State of Delaware and the federal district courts of the United States as the sole and exclusive forums for certain types of actions and proceedings that may be initiated by our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers, employees or agents.
- Our insurance coverage may be inadequate or expensive.
Management Discussion
- Asset-based revenue increased by $19.3 million, or 3.6%, from $534.2 million in the year ended December 31, 2022 to $553.5 million in the year ended December 31, 2023. This increase was related to increased platform fees and advisory fees of $10.9 million associated with higher incremental average assets and the inclusion of Adhesion Wealth platform fees of $8.9 million, partially offset by lower custodial revenue of $0.5 million.
- Spread-based revenue increased by $63.5 million, or 111.7%, from $56.8 million in the year ended December 31, 2022 to $120.3 million in the year ended December 31, 2023. This increase was primarily related to higher interest earned at third-party banks of $87.4 million, driven by an increase in interest rates subsequent to December 31, 2022, offset by an increase in interest credited to client accounts of $23.9 million.
- Subscription-based revenue increased by $2.2 million, or 16.6%, from $13.0 million in the year ended December 31, 2022 to $15.2 million in the year ended December 31, 2023. This increase was primarily related to an increase in the average number of subscription licenses.