IFF

International Flavors & Fragrances($IFF): CEO and Executives Pour $6 Million Into Stock Amid 25% Share Plunge

05/23/2025 21:31

As shares of flavor and fragrance giant International Flavors & Fragrances ($IFF) have tumbled nearly 25% over the past six months, multiple top executives including the CEO have been aggressively buying the stock in recent months, sending a powerful insider confidence signal to the market. IFF shares peaked around $105 in mid-October 2024 before gradually declining to as low as $66.85 in early April 2025, pressured by disappointing quarterly forecasts, goodwill impairment charges, and concerns about the Trump administration's tariff policies. Recently, the stock has rebounded to the $75-77 range, showing modest signs of recovery. Amid this share price weakness, CEO Erik Fyrwald has made remarkably bold personal investments in the company's stock. Fyrwald purchased 25,000 shares worth approximately $2 million at $80.24 per share on March 4, followed by an additional 25,000 shares for about $1.85 million on May 8-9. In just two months, the CEO has invested roughly $3.85 million of his own money to acquire 50,000 shares. Even more compelling is that this buying activity extends beyond the CEO to the broader leadership team. Director Kevin O'Byrne acquired a total of 11,000 shares (approximately $865,000) across purchases in March and May, while Director Mehmood Khan bought 4,000 shares ($301,298) on May 15, and Director Hernandez Palau purchased 850 shares ($65,807) on May 19. Particularly noteworthy was Executive Vice President Stephen Landsman's May 19 purchase of 12,000 shares for $928,787. "When multiple senior executives invest over $6 million of their personal funds in company stock within just three months, it strongly suggests insiders believe the current share price significantly undervalues the company's intrinsic worth," noted one Wall Street analyst. These insider buying signals should be considered alongside IFF's recent financial performance. The company reported Q1 revenues of $2.84 billion (down 1.9% year-over-year) in early May, but adjusted EPS of $1.20 exceeded analyst expectations of $1.12. However, a $1.15 billion goodwill impairment charge resulted in a reported EPS of -$3.98. Notably, the concentrated insider buying followed immediately after these earnings results. Executives likely perceived that the market had overreacted to the impairment charge while overlooking strong performance in segments like Taste (+7% growth) and Pharma Solutions (+17% growth). Morgan Stanley upgraded IFF to "overweight" from "equal weight" in mid-November, stating that "a good opportunity to buy the shares" had emerged following a recent 12% price pullback. The firm further noted that "IFF trades at a 40% discount to the U.S. consumer index, and also trades inexpensive compared with its peers." The flavors and fragrances industry is projected to exceed 3% average market growth in 2025, with competitor Givaudan recently upgraded to a 'buy' rating due to its significant exposure to high-growth categories. Meanwhile, IFF is focusing on reducing its debt ratio by the end of 2025 and forecasts total sales between $10.6-10.9 billion and adjusted operating EBITDA between $2-2.15 billion (5-10% growth). Considering the concentrated insider buying pattern and relatively undervalued metrics, $IFF may offer an attractive entry point for long-term investors. However, goodwill impairment charges, revenue decline trends, and uncertainties surrounding global trade tensions and tariff policies remain risk factors to monitor. When top executives invest millions of their own dollars in company stock, it's one of the strongest possible indicators that they genuinely believe in the company's future. IFF's case exemplifies how insider trading can sometimes identify corporate value recovery signals ahead of the broader market.

You can receive notifications when news is published.