Top Stock Picks for 2022 by Three Highly Convicted PMs

# **Company Analysis: Compass Diversified Holdings (CODI) – A Unique Investment Opportunity**

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In this video, we delve into the thriving world of private equity and focus on Compass Diversified Holdings (CODI), a publicly traded private equity firm with a remarkable approach. Unlike its peers in the public private equity space, CODI boasts permanent capital at the holding company level. This unique advantage enables them to adopt a long-term investment horizon, nurturing the companies they invest in for extended periods of five to ten years, and sometimes even longer[^1].

One of the primary reasons we are highly enthusiastic about CODI is their exceptional management team and their strategic focus on niche consumer and industrial businesses[^1]. This targeted approach allows them to capitalize on opportunities, nurturing the growth of these businesses while simultaneously increasing their own investor base.

In fact, CODI recently converted to a C-corp, opening doors for a broader range of investors[^1]. This move is expected to stimulate multiple expansion and further facilitate their growth objectives in the coming year. With disruptive forces continuously transforming the marketplace, it has become increasingly necessary for companies to adapt to market forces through operational, cultural, and capital allocation strategies[^2].

For instance, MKS Instruments successfully transitioned from a pure-play wafer fab equipment manufacturer to material sciences, thus effectively addressing industry shifts towards advanced packaging within the semiconductor wafer processing sector. As the limitations of Moore’s Law become apparent, adaptability has become key to surviving in the ever-evolving market[^2].

Similarly, Kennedy Wilson, an alternative real estate manager, recognized the global demand for yield within alternative real estate investments. By shifting from a principal capacity to an agency capacity, they have strategically positioned themselves for success, leveraging their 30-year history of property ownership and development[^2].

Another company, Jo-Ann Stores, has captured our attention with their fascinating story. As a leading supplier of yarn and sewing products in the retail environment, they have naturally found protection from internet competition. The tactility and visual experience that customers seek while selecting yarn provide a crucial advantage for Jo-Ann Stores, allowing them to differentiate themselves from online competitors. Furthermore, their successful expansion into the arts and crafts segment complements their existing business, offering a compelling growth story[^2].

If you’re looking for an investment opportunity with strong fundamentals, growth potential, and excellent prospects, CODI could be the perfect fit for your portfolio. With a clean balance sheet, exceptional leadership, and promising catalysts on the horizon, CODI presents an enticing chance to invest in a well-positioned company poised for future success[^2].

To learn more about CODI and explore investment possibilities, visit our website at []( or contact us at (800) 841-1180.

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📑 **Sources**:
[1]: [](
[2]: [Transcript of the video](transcript_link)

You may obtain a prospectus for any of The Royce Funds on our website at or by calling (800) 841-1180. The prospectus includes investment objectives, risks, fees, charges, expenses, and other information that you should read and consider carefully before investing.

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