A risk factor worthy of a bumper sticker?

June 4, 2007

images.jpegWhen it comes to risk factors, most companies present a laundry list that runs the gamut from garden variety lawsuits to the sky falling. But the 10-K filed by Stanley Inc. (SXE) late Friday included something that, given the news that 14 more U.S. soldiers had been killed this past weekend, seems more than hypothetical.

That’s because Stanley — not to be confused with Stanley Works (SWK) or Stanley Furniture (STLY) — is focused on defense contracts. Indeed, roughly 65% of its $409 million in revenues according to the K comes from the Department of Defense. That’s up from the 61% on revenues of $345 million that the company disclosed in the amended S-1 the company filed last October, just before it went public at $13 a share. So when the company discloses that “Our business commitments require our employees to travel to potentially dangerous places, which may result in injury to our employees” it seems like more than just another boring risk factor.

Also interesting was the company’s use of the increasingly controversial words “global war on terrorism” which Democratic Presidential candidate John Edwards described as a “bumper sticker — political slogan, that’s all it is” during last night’s Democratic presidential debate. In the K, the company only referred to the “global war” three times, down from the five used in the most recent S-1. This, despite the fact that revenues from the “global war” are certainly driving Stanley.

And, now a brief programming note: over the weekend, I installed a feature that brings up stock quotes for various companies that appear on the blog. So now, when you scroll over a company’s name, it will bring up a stock quote.

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