RYAM

Rayonier Advanced Materials ($RYAM) President Invests Quarter Million Dollars After Stock Plunges 50%

05/20/2025 13:44

The top executive at Rayonier Advanced Materials ($RYAM) has made a significant stock purchase following a dramatic share price decline, potentially signaling that insiders see value that the market may be overlooking. On May 16, 2025, Delyle Bloomquist, President of Rayonier Advanced Materials, acquired 63,291 shares at an average price of $3.95 per share. The total investment amounted to approximately $250,000. This purchase comes at a time when $RYAM stock has plummeted nearly 50% since the beginning of the year. Notably, this insider buy occurred shortly after the company reported disappointing first-quarter results in early May. According to the May 6 earnings report, Rayonier posted an adjusted loss of 49 cents per share, significantly worse than analysts' expectations of a 10-cent loss. Revenue also declined by 8.2% to $356 million, substantially below the market forecast of $385 million. Following this earnings report, $RYAM shares fell to as low as $3.63 on May 9, before recovering slightly to $4.19 on May 16, the day of Bloomquist's purchase. However, this is still less than half the price level the stock commanded in mid-December 2024, when it traded above $8. What makes this insider transaction particularly interesting is that it represents the second major insider purchase within the past six months. On December 13, 2024, Director Eric Bowen acquired 12,500 shares at $8.04 per share, investing a total of $100,500. The fact that executives are continuing to buy despite the stock losing more than half its value in just five months could be interpreted as a sign of internal confidence in the company's long-term value proposition. Rayonier Advanced Materials is a global leader in cellulose specialty products and announced a price increase of up to 10% for these products last September. However, the company has been negatively impacted by tariff concerns amid escalating U.S.-China trade tensions. In its March guidance, the company specifically mentioned that a 25% tariff on U.S. sales of paperboard in 2025 would affect its performance. "President Bloomquist's substantial stock purchase demonstrates management's conviction that the current share price significantly undervalues the company's intrinsic worth," noted Andrew Steinkirchner, analyst at Raymond James. "The timing of this purchase, coming after disappointing earnings and tariff impacts have driven the stock down, makes it particularly meaningful." Analysts' average rating on $RYAM remains a 'buy,' though price targets have been revised downward, with the most recent consensus at $10.00, down from $12.50 in March and $11.00 in early May. Still, this target implies approximately 150% upside from current levels. Investors should watch for potential improvements in the company's performance, additional insider trading patterns, and developments in U.S.-China trade relations. Recent signals of easing trade tensions in the broader U.S. market could provide a positive catalyst for companies like Rayonier that are affected by tariffs. Bloomquist's stock purchase represents a significant vote of confidence in the company's long-term business outlook despite short-term price volatility. For a small-cap company like Rayonier ($RYAM), with a current market capitalization of approximately $331 million, the executive's insider transaction represents a substantial commitment relative to the company's overall market value. Executive stock purchases are often considered strong signals that shares may be undervalued. The size of the President's investment suggests this is not merely a symbolic transaction but rather a demonstration of conviction in the company's fundamentals. This insider activity reflects management's belief that current challenges are temporary and that the company will recover value over the long term.

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