First Advantage (NYSE:FA) and Korn/Ferry International (NYSE:KFY) Financial Review

Korn/Ferry International (NYSE:KFY) and First Advantage (NYSE:FA) are both mid-cap industrials companies, but which is the better stock? We will contrast the two businesses based on the strength of their risk, analyst recommendations, earnings, valuation, institutional ownership, dividends and profitability.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Korn/Ferry International and First Advantage, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Korn/Ferry International	0	1	4	0	2.80
First Advantage	0	3	3	0	2.50

Korn/Ferry International presently has a consensus target price of $80.25, indicating a potential upside of 2.78%. First Advantage has a consensus target price of $23.33, indicating a potential upside of 3.84%. Given First Advantage’s higher possible upside, analysts clearly believe First Advantage is more favorable than Korn/Ferry International.

Valuation and Earnings

This table compares Korn/Ferry International and First Advantage”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Korn/Ferry International	$2.94 billion	1.45	$277.43 million	$5.30	14.73
First Advantage	$1.66 billion	2.32	$37.29 million	$0.14	160.50

Korn/Ferry International has higher revenue and earnings than First Advantage. Korn/Ferry International is trading at a lower price-to-earnings ratio than First Advantage, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Korn/Ferry International and First Advantage’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Korn/Ferry International	9.36%	14.43%	7.36%
First Advantage	0.65%	13.16%	7.33%

Institutional and Insider Ownership

98.8% of Korn/Ferry International shares are owned by institutional investors. Comparatively, 94.9% of First Advantage shares are owned by institutional investors. 1.0% of Korn/Ferry International shares are owned by insiders. Comparatively, 4.4% of First Advantage shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Volatility & Risk

Korn/Ferry International has a beta of 1.25, indicating that its stock price is 25% more volatile than the S&P 500. Comparatively, First Advantage has a beta of 1.12, indicating that its stock price is 12% more volatile than the S&P 500.

Summary

Korn/Ferry International beats First Advantage on 10 of the 14 factors compared between the two stocks.

About Korn/Ferry International

Korn Ferry, together with its subsidiaries, provides organizational consulting services worldwide. It operates through four segments: Consulting, Digital, Executive Search, and Recruitment Process Outsourcing (RPO) & Professional Search. The company provides executive search services to recruit board level, chief executive, other senior executive, and general management talent of organizations. It also offers organizational strategy, assessment and succession, leadership and professional development, and total reward services. In addition, the company provides RPO, business project, professional search, and outsource recruiting solutions. Further, the company offers tech-enabled solutions that identify structures, roles, capabilities, and behaviors to drive businesses. It serves public and private companies, and middle market and emerging growth companies, as well as government and non-profit organizations. The company was formerly known as Korn/Ferry International and changed its name to Korn Ferry in January 2019. Korn Ferry was founded in 1969 and is based in Los Angeles, California.

About First Advantage

First Advantage Corporation provides employment background screening, identity, and verification solutions worldwide. It offers pre-onboarding products and solutions, such as criminal background checks, drug/health screening, extended workforce screening, FBI channeling, identity checks and biometric fraud mitigation tools, education/work history verification, driver records and compliance, healthcare credentials, executive screening, and other screening products. The company also provides post-onboarding solutions, including criminal records monitoring, healthcare sanctions, motor vehicle records, social media screening, and global sanctions and licenses; and other products comprising fleet/vehicle compliance, hiring tax credits and incentives, resident/tenant screening, and investigative research. Its products and solutions are used by personnel in recruiting, human resources, risk, compliance, vendor management, safety, and/or security in global enterprises, mid-sized, and small companies. The company was formerly known as Fastball Intermediate, Inc. and changed its name to First Advantage Corporation in March 2021. First Advantage Corporation was founded in 2002 and is based in Atlanta, Georgia.