The stock market ended the last month with four straight daily declines, with the benchmark indices suffering their biggest monthly declines since 2015. The sell-off was triggered by Jerome Powell’s remarks about keeping monetary policy tight for some time.
Although the Fed has already hiked rates four times for a total of 2.25 percentage points, Cleveland Federal Reserve President Loretta Mester said on Wednesday that she sees interest rates rising considerably higher before the central bank can ease.
Despite such turmoil, investing in the market might be a good strategy to prevent one’s money from losing value amid an inflationary backdrop. While the stock market has experienced dips, it has also delivered returns that have beat inflation.
Fundamentally solid penny stocks Overseas Shipholding Group, Inc. (OSG), Hill International, Inc. (HIL), and ARC Document Solutions, Inc. (ARC) look poised to beat the market volatility. So, these stocks could be solid investments now.
Overseas Shipholding Group, Inc. (OSG)
OSG owns and operates a fleet of oceangoing vessels engaged in transporting crude oil and petroleum products in the United States flag trade. The company serves independent oil traders, refinery operators, and government entities.
On June 13, OSG announced that its Board of Directors had authorized a program to purchase up to five million shares of the company’s common stock. The Company intends to fund the share repurchase program with excess cash.
For the second quarter of 2022 ended June 30, OSG’s shipping revenues increased 33.5% year-over-year to $117.99 million. Its adjusted EBITDA rose 209.9% from its previous-year quarter to $31.48 million. Net earnings and net earnings per class A share came in at $3.74 million and $0.04, up 135% and 133.3% from the prior-year period.
OSG has gained 65.4% year-to-date and 49.5% over the past six months to close its last trading session at $3.11.
OSG’s POWR Ratings reflect this promising outlook. The company has an overall rating of A, which translates to Strong Buy in our proprietary rating system. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.
OSG has an A grade for Momentum and a B grade for Sentiment and Quality. It is ranked #2 out of the 44 stocks in the A-rated Shipping industry. Click here to see the additional POWR Ratings for OSG (Growth, Value, and Stability).
Hill International, Inc. (HIL)
HIL provides project and construction management and other consulting services primarily for buildings, transportation, environmental, energy, and industrial markets. It primarily serves the United States federal, state, and local governments, other national governments, and the private sector.
On August 30, HIL announced that it had been selected by Egypt’s Ministry of Defense to provide project management and supervision consultancy services for the International Stem Cell and Regenerative Medicine Research and Therapeutic Center project. The new project should benefit the company.
On August 16, HIL announced it had entered into a definitive merger agreement with Global Infrastructure Solutions Inc., under which GISI would commence an all-cash tender offer to acquire 100% of the issued and outstanding shares of the company.
HIL CEO Raouf Ghali said, “By joining the GISI family of companies, Hill will be well-positioned to continue to take advantage of the opportunities the industry offers while concurrently enhancing the quality of our client services thanks to GISI’s focus on long-term success.”
HIL’s total revenue increased 4.1% year-over-year to 105.73 million in the second quarter that ended June 30. Its adjusted EBITDA grew 70.9% from the year-ago value to $6.53 million, while its adjusted net income improved 4,435.1% year-over-year to $3.21 million. The company’s earnings per common share increased 300% from its year-ago value to $0.02.
The stock has gained 103% over the past three months and 93.7% over the past month to close its last trading session at $3.37.
This promising prospect is reflected in HIL’s POWR Ratings. The stock has an overall A rating, equating to a Strong Buy in our proprietary rating system. HIL is rated a B in Growth and Quality. Within the B-rated Industrial - Services industry, it is ranked #4 out of 89 stocks.
To see additional POWR Ratings for Value, Momentum, Stability, and Sentiment for HIL, click here.
ARC Document Solutions, Inc. (ARC)
ARC provides digital printing and document-related services in the United States. The company offers managed print services, cloud-based document management software, and other digital hosting services.
On July 28, ARC declared a quarterly dividend of $0.05 per share, payable to shareholders on November 30. This reflects upon the cash generation ability of the company.
ARC’s net sales increased 8.4% year-over-year to $74.56 million for the second quarter ended June 30. Its operating income increased 32.9% year-over-year to $5.56 million, while adjusted net income attributable to ARC came in at $3.69 million, representing a 39.8% year-over-year growth. Adjusted EPS increased 33.3% from the prior-year period to $0.08.
Analysts expect ARC’s EPS for the fiscal year 2022 to be $0.27, representing a 22.7% year-over-year growth. The company’s revenue is expected to grow 5% from the prior year to $285.70 million for the same period.
ARC has gained 5% over the past month to close its last trading session at $2.95. It has gained 1% intraday.
It is no surprise that ARC has an overall A rating, which equates to a Strong Buy in our POWR Ratings system. It also has an A grade for Value, Sentiment, and Quality and a B for Stability. It is ranked #2 of 41 stocks in the B-rated Outsourcing - Business Services industry.
Beyond what we’ve stated above, we have also given ARC grades for Growth and Momentum. Get all ARC ratings here.
OSG shares were trading at $3.11 per share on Thursday afternoon, down $0.00 (0.00%). Year-to-date, OSG has gained 65.43%, versus a -16.40% rise in the benchmark S&P 500 index during the same period.
About the Author: Kritika Sarmah
Her interest in risky instruments and passion for writing made Kritika an analyst and financial journalist. She earned her bachelor's degree in commerce and is currently pursuing the CFA program. With her fundamental approach, she aims to help investors identify untapped investment opportunities.
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