FADV a Hold After Earnings Release

 A Hold recommendation has recently been issued to business service provider First Advantage Corporation (FADV) by Zacks business services sector analyst Sean P. Smith. Here's what his latest update said:

"We maintain our Hold rating on shares of FADV following the release of Q3 financial results. We believe the shares of First Advantage Corporation are appropriately valued near current levels. The shares of FADV are currently trading at a P/E multiple of 15.9x estimated 2007 EPS.

"We believe that, given the present earnings growth outlook, and the uncertainty related to the company's exposure to the mortgage market, the current multiple is reasonable. Weakness in the Lender Services segment in particular during the quarter was a concern.

"We note that ChoicePoint (CPS), the company's closest publicly traded peer, is currently trading at approximately 21.8x consensus estimated 2007 EPS. Given the issues cited above, we feel that FADV should trade at a discount. Our $20.00 six-month target price for FADV is based on a P/E multiple of 17x estimated 2007 EPS."

Read the full analyst report on FADV.

Read the full analyst report on CPS.

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