AIN

Albany International ($AIN) Executives Buy More as Stock Falls Further..."Heavy Purchases Near Lows Signal Bottom?"

11/18/2025 16:28

Albany International ($AIN), founded in 1895, is an industrial textile and aerospace composites manufacturer operating two main business segments: Machine Clothing for paper manufacturing and Albany Engineered Composites (AEC) for advanced aircraft components. With 5,400 employees across 54 countries and long-term contracts with major defense contractors like Lockheed Martin and Boeing, the company has maintained a stable order base until recently facing unexpected massive losses from the CH-53K helicopter program. What's particularly noteworthy is the wave of insider buying amid the stock's dramatic decline. On November 5, 2024, when shares traded around $71, four executives simultaneously purchased a total of 4,450 shares worth approximately $317,000. CFO Robert Starr, SVP Robert Hansen, President Gunnar Kleveland, and Officer Joseph Gaug all participated in what appears to be coordinated buying, suggesting management viewed the decline as temporary. The subsequent pattern is even more intriguing. As shares fell to $59 on August 5, 2025, President Kleveland purchased an additional 1,750 shares for $104,000. Most recently, when the stock hit yearly lows around $42 on November 17, he bought 2,300 shares for $96,000 at $42.04 per share. This represents classic dollar-cost averaging, with increasing purchase quantities as prices declined: 1,400 shares at $71, 1,750 at $59, and 2,300 at $42. Such aggressive buying during declining markets is rare among corporate insiders, who typically purchase during uptrends or through systematic buying programs. Albany International's executives are demonstrating unusual conviction by buying more shares at lower prices, suggesting they believe current levels represent significant value. The company's recent financials appear to contradict this optimism. Q3 2025 revenue declined 12.4% year-over-year to $261.4 million, missing analyst estimates by 12.24%. The AEC segment's 25% revenue drop was particularly damaging, compounded by a $97.8 million net loss from CH-53K program adjustments that forced management to withdraw full-year 2025 guidance. However, insiders may be focusing on different metrics. The company maintains $108 million in cash with positive trailing twelve-month levered free cash flow of $146.7 million, indicating strong cash generation despite net losses. The Machine Clothing segment, while experiencing slight revenue decline, still generated $43.1 million in operating income, demonstrating resilient profitability in the core business. Current valuation appears significantly discounted. Shares have fallen 33% from June 2024 highs of $85 to current levels around $57, potentially overreacting to one-time charges. With analyst price targets averaging $59, current prices may reflect excessive pessimism. The recent extension of JASSM and LRASM missile program contracts with Lockheed Martin through 2029 provides stability, suggesting CH-53K losses represent isolated issues rather than systematic problems across the aerospace portfolio. Investors should monitor specific recovery indicators: AEC segment revenue returning to $200 million quarterly levels would validate insider optimism, while Machine Clothing operating margins maintaining above 25% would confirm core business resilience. Achievement of both metrics could drive shares back toward $70. Conversely, warning signs include AEC revenue falling below $80 million quarterly or cash reserves dropping below $50 million. Any contract cancellations or delays with defense contractors would require immediate position reassessment. In an optimistic scenario where CH-53K losses remain one-time and AEC normalizes, shares could recover above $80. The base case suggests gradual improvement starting Q4 2025, with shares stabilizing in the $65-70 range. While Albany International faces serious near-term challenges, sustained insider buying from knowledgeable management suggests current prices may represent compelling value for patient investors willing to wait for operational recovery confirmation.