Shares of Rayonier Advanced Materials Inc (RYAM) are moving on volatility today -0.29% or -0.04 from the open. The NYSE listed company saw a recent bid of 13.62 and 30633 shares have traded hands in the session.
Although there are countless strategies to use when picking stocks, unfortunately there is no magic recipe for success. Investors who are able to study previous winning techniques might have an easier time assembling a structured plan that puts them one step ahead of the field. Superior knowledge is a major key to success. Having the right information and knowing how to apply it to stock picking can be a huge boost to the investor’s stock portfolio. Plenty of information is available on publically traded companies. Sorting through the data can be tough, but taking the time to understand how a company makes money can greatly assist the individual investor.
Now let’s take a look at how the fundamentals are stacking up for Rayonier Advanced Materials Inc (RYAM). Fundamental analysis takes into consideration market, industry and stock conditions to help determine if the shares are correctly valued. Rayonier Advanced Materials Inc currently has a yearly EPS of 0.83. This number is derived from the total net income divided by shares outstanding. In other words, EPS reveals how profitable a company is on a share owner basis.
Another key indicator that can help investors determine if a stock might be a quality investment is the Return on Equity or ROE. Rayonier Advanced Materials Inc (RYAM) currently has Return on Equity of 75.32. ROE is a ratio that measures profits generated from the investments received from shareholders.
In other words, the ratio reveals how effective the firm is at turning shareholder investment into company profits. A company with high ROE typically reflects well on management and how well a company is run at a high level. A firm with a lower ROE might encourage potential investors to dig further to see why profits aren’t being generated from shareholder money.
Another ratio we can look at is the Return on Invested Capital or more commonly referred to as ROIC. Rayonier Advanced Materials Inc (RYAM) has a current ROIC of 8.02. ROIC is calculated by dividing Net Income - Dividends by Total Capital Invested.
Similar to ROE, ROIC measures how effectively company management is using invested capital to generate company income. A high ROIC number typically reflects positively on company management while a low number typically reflects the opposite.
Turning to Return on Assets or ROA, Rayonier Advanced Materials Inc (RYAM) has a current ROA of 5.41. This is a profitability ratio that measures net income generated from total company assets during a given period. This ratio reveals how quick a company can turn it’s assets into profits. In other words, the ratio provides insight into the profitability of a firm’s assets. The ratio is calculated by dividing total net income by the average total assets.
A higher ROA compared to peers in the same industry, would suggest that company management is able to effectively generate profits from their assets. Similar to the other ratios, a lower number might raise red flags about management’s ability when compared to other companies in a similar sector.
