Investors are closely watching the recent unusual activity in options trading on Rayonier Advanced Materials Inc. (NYSE:RYAM) stock. On Friday, June 2nd, investors purchased an unusually high number of put options – a type of option contract that allows the holder to sell an underlying asset at a specified price within a specific time frame. The number of put options purchased – 20,675 – was an increase of approximately 566% compared to the average daily volume.
The increased trading activity follows several recent moves by institutional investors and hedge funds in RYAM. Brandywine Global Investment Management LLC and Putnam Investments LLC both acquired new positions in the company during the first quarter of 2023, while Ameriprise Financial Inc., JPMorgan Chase & Co., and State Street Corp all raised their holdings in RYAM stock. In fact, 75.14% of RYAM’s stock is currently owned by institutional investors.
In May, two directors also made significant purchases of RYAM stock. Lisa M. Palumbo bought a total of 20,000 shares for $99,300, while CEO Delyle W. Bloomquist purchased 60,000 shares for $268,200. These insider purchases suggest that those within the company feel confident about its future prospects.
A number of analysts have recently commented on RYAM as well. StockNews.com started coverage with a “hold” rating on May 18th, while Royal Bank of Canada upgraded RYAM from a “sector perform” rating to an “outperform” rating with a $7 target price on May 11th.
All eyes will be on Rayonier Advanced Materials as investors wait to see how these recent developments will affect the company’s performance in the future.
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Rayonier Advanced Materials: A Promising Opportunity Amid Stock Market Fluctuations
As the stock market continues to fluctuate, many investors are looking for promising opportunities amid uncertainty. For those interested in the basic materials sector, Rayonier Advanced Materials (NYSE:RYAM) is one company that may catch their eye.
On June 4, 2023, Rayonier Advanced Materials traded up $0.18, reaching $3.67. Its trading volume was 675,469 shares, compared with an average of 758,497 shares. This specialty chemical company has a market capitalization of $238.99 million with a price-to-earnings (PE) ratio of 21.81 and a beta of 3.15, indicating high volatility.
Rayonier Advanced Materials’ current price falls within its range between the 12-month low ($2.43) and high ($9.84). The fifty-day moving average is $5.14 and the 200-day moving average is $6.67.
Taking into account liquidity ratios, Rayonier Advanced Materials boasts a current ratio of 2.06 and a quick ratio of 1.32, indicating that it can cover its short-term debts using assets that can be easily converted into cash.
It’s worth mentioning that Rayonier Advanced Materials has a debt-to-equity ratio of 1.00 which may raise eyebrows for some investors who are hesitant about taking on too much risk.
However, some investors have become bullish after realizing the potential earning power from recent earnings reports that were better than expected.
The latest earnings report by Rayonier Advanced Materials was released on February 28th where they reported earnings per share (EPS) at $0.04 for the quarter whereas analysts predicted only $0.02 EPS showing outperformance by factors unknown at this point in time . Additionally ,Last year during the same time period ,the company had posted negative ($0.37) earnings per share making it an improvement.
Moreover, the company had recorded a revenue of $500 million for the quarter, which added to the bullish sentiment among investors. With a net margin of 0.71% and return on equity of 0.62%, some analysts have predicted that Rayonier Advanced Materials will post -0.13 earnings per share for the current year.
In conclusion, while it’s important to do one’s due diligence before making an investment decision , Rayonier Advanced Materials offers not only potential reward but risks as well making it an interesting opportunity for those willing to accept high volatility in their portfolio .
