10 Best Dividend Stocks Under $5

7. ARC Document Solutions, Inc. (NYSE:ARC)

Number of Hedge Fund Holders: 9

Share Price as of the close of August 23: $2.97

ARC Document Solutions, Inc. (NYSE:ARC) is a California-based company that offers specialized document solutions to businesses of all kinds. In the past three months, the shares have surged by over 9%. The gain is mainly attributed to the recent binding offer of $3.25 per share to take the company private, proposed by the company’s CEO. However, it is still uncertain whether this deal will ultimately go through.

In the second quarter of 2024, ARC Document Solutions, Inc. (NYSE:ARC) reported strong sales, and the company managed to reverse the year-over-year decline in gross margin experienced in the first quarter. Several large projects were completed in the last month of the second quarter, shifting collections into the third quarter, which temporarily subdued operating cash flow performance. However, the company remains confident that cash flows will improve in the third and fourth quarters, as they did last year. Its revenue for the quarter came in at over $75 million, which showed a 3.8% growth from the same period last year.

Digital printing was one of the best-performing segments of ARC Document Solutions, Inc. (NYSE:ARC) in Q2 2024. The sales in the segment rose by 5.8% compared to the previous year. Year-over-year sales experienced solid growth in digital color graphic printing, driven by both new and existing customers. In addition to these strong results, the company is also a solid pick for dividend seekers, especially since it has cash in its back pocket. It ended the quarter with nearly $50 million available in cash and cash equivalents. The company’s operating cash flow was $6.4 million.

On August 1, ARC Document Solutions, Inc. (NYSE:ARC) declared a quarterly dividend of $0.05 per share, which was in line with its previous dividend. The company initiated its dividend policy in 2019 but had to temporarily halt payouts in 2020 due to challenges related to the pandemic. The stock’s dividend yield sits at 6.73%, as of August 23.

According to Insider Monkey’s database of Q2 2024, 9 hedge funds held stakes in ARC Document Solutions, Inc. (NYSE:ARC), up from 8 in the preceding quarter. These stakes have a collective value of more than $8.7 million.