Here’s What Makes First Advantage Corporation (FA) an Attractive Investment Choice

Diamond Hill Capital Management, an investment advisor, released its “Small Cap Fund” second quarter 2022 investor letter. A copy of the same can be downloaded here. The second quarter was challenging for US stocks and the Russell 2000 Index fell by more than 17%. The volatile market condition affected the fund’s portfolio performance; however, the fund performed better compared to the Russell 2000 Index. In addition, you can check the top 5 holdings of the fund to know its best picks in 2022.

In the second quarter investor letter, Diamond Hill Capital Management discussed stocks like First Advantage Corporation (NASDAQ:FA). Headquartered in Atlanta, Georgia, First Advantage Corporation (NASDAQ:FA) is a background checks and screening services provider. On September 2, 2022, First Advantage Corporation (NASDAQ:FA) stock closed at $13.82 per share. One-month return of First Advantage Corporation (NASDAQ:FA) was -0.22% and its shares lost 40.69% of their value over the last 52 weeks. First Advantage Corporation (NASDAQ:FA) has a market capitalization of $2.118 billion.

Here is what Diamond Hill Capital Management specifically said about First Advantage Corporation (NASDAQ:FA):

“First Advantage Corporation (NASDAQ:FA) is one of the largest background screening companies. We believe the largest players in this field stand to benefit disproportionately from increasing technology usage, greater regulatory complexity, consolidation and growth opportunities outside the US. We believe First Advantage is positioned well among peers, having a moderate lead in technology and innovation, a favorable client/end-market mix, a focused strategy with less M&A historically, and a strong management team with good continuity. Largely indiscriminate disinterest toward recent initial public offerings (First Advantage went public in June 2021) along with concerns about a potentially cooling labor market in the near-term gave us an opportunity to purchase shares at what appear to us an attractive discount to long-term intrinsic value.”

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First Advantage Corporation (NASDAQ:FA) is not on the list of 30 Most Popular Stocks Among Hedge Funds. First Advantage Corporation (NASDAQ:FA) was held by 17 hedge fund portfolios at the end of the second quarter compared to 20 in the previous quarter.

We discussed First Advantage Corporation (NASDAQ:FA) in another article and shared Baron Funds’ views on the company. You can check out our hedge fund investor letters Q2 2022 page for more investor letters from hedge funds and other prominent investors.

Disclosure: None. This article is originally published at Insider Monkey.