First American Financial Corp Leads Strategic Moves with 1.36% Portfolio Impact

Private Capital's second-quarter 2025 13F filing reveals strategic moves, with First American Financial Corp being the largest addition, accounting for 1.36% of the portfolio. (Trades, Portfolio) also increased stakes in Ligand Pharmaceuticals and International Business Machines Corp, and exited National Fuel Gas Co and American Electric Power Co Inc.

Private Capital's (Trades, Portfolio) second-quarter 2025 13F filing offers a glimpse into the firm's strategic investment decisions. The filing reveals a mix of new additions, increased stakes, and exits, providing insights into the firm's value investing philosophy.

Key Additions and Increases

The largest addition to Private Capital's portfolio was First American Financial Corp (NYSE: FAF), with 229,028 shares, accounting for 1.36% of the portfolio and a total value of $14.06 million [1]. This investment reflects a calculated bet on the real estate sector's growth potential. Additionally, Private Capital increased stakes in Ligand Pharmaceuticals Inc (NASDAQ: LGND) by 81,128 shares, bringing the total to 229,253 shares, and International Business Machines Corp (NYSE: IBM) by 24,419 shares, bringing the total to 36,901 [1].

Exits and Reductions

Private Capital exited National Fuel Gas Co (NYSE: NFG) and American Electric Power Co Inc (NYSE: AEP) entirely in the second quarter of 2025 [1]. The firm also reduced positions in several stocks, including Everi Holdings Inc (EVRI) by 322,965 shares and StoneX Group Inc (NASDAQ: SNEX) by 29,580 shares [1].

Portfolio Overview

At the end of the second quarter of 2025, Private Capital's portfolio included 162 stocks, with top holdings in QuinStreet Inc (NASDAQ: QNST), Harrow Inc (NASDAQ: HROW), Barrett Business Services Inc (NASDAQ: BBSI), Lantheus Holdings Inc (NASDAQ: LNTH), and BGC Group Inc (NASDAQ: BGC) [1].

Investment Thesis

Private Capital's strategic allocation to FAF underscores the company's potential to outperform in a sector poised for transformation. The firm's value investing philosophy, focusing on acquiring assets at a discount to intrinsic value while managing downside risk, is evident in this investment [2]. For value investors, FAF represents a high-conviction opportunity, despite its current P/E ratio appearing elevated. The company's operational improvements, digital innovation, and market leadership justify a premium. Investors with a 3–5 year horizon should consider FAF as a core holding in a diversified portfolio [2].

References

[1] https://finance.yahoo.com/news/private-capitals-strategic-moves-first-031722825.html
[2] https://www.ainvest.com/news/unlocking-real-estate-private-capital-strategic-bet-american-financial-corp-2508/