Penny Stocks: Is ARC Document Solutions Undervalued Right Now?

Penny stocks

Selling for $2.26 USD on the NYSE, the ARC penny stock could be a consideration for your portfolio. Small-capped companies do bring more risk when investing but that low buy-in price is quite attractive.

We’re looking at ARC because some analysts are calling it undervalued right now.

Penny Stocks to Watch: ARC

ARC Document Solutions (NYSE:ARC) works in tandem with engineers, construction companies, and architects; any building-related project that needs computer-aided design. ARC’s services also offer digital blueprints and large format printing, all the while giving workers the ability to share and collaborate.

Company Value

Based on its current penny stock price, ARC is valued at approximately $108 million USD. It’s a small enough company, yet for its size, it generated $394 million in revenue for the full year 2017.

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Further, in the books, ARC Document Solutions looks solid, with total assets reaching $339 million against total liabilities of $201.8 million.

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ARC Penny Stock

One thing to note about this penny stock is that large quantities are held by institutional investors. 75% of shares, to be more precise, are owned by professional money handlers such as hedge funds. Another 17% are owned by company insiders, and what’s left for public trading on the open market every day is a meager 7%.

But if you can get your hands on some of that 7%, be prepared for a volatile stock. These shares, according to The Balance, are “slightly more than 2 and a half times as volatile as the overall markets.” This means that the ARC penny stock, being more active than most, can experience greater losses and gains.

An Undervalued Penny Stock?

Now, Zacks Investment Research is calling ARC an undervalued penny stock and has given it a buy/strong buy rating.

Based on those metrics, ARC looks to be in a strong financial position and is considered undervalued at present by top analysts.

One further cherry on top: the company is actually buying back its shares in the open market—a sure sign that operations are moving in the right direction.

Is ARC the stock for you?

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