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FIRST ADVANTAGE CORP (FA) Stock Fundamental Analysis

NASDAQ:FA - Nasdaq - US31846B1089 - Common Stock - Currency: USD

18.24  -0.5 (-2.67%)

After market: 18.24 0 (0%)

Fundamental Rating

4

We assign a fundamental rating of 4 out of 10 to FA. FA was compared to 82 industry peers in the Professional Services industry. The financial health of FA is average, but there are quite some concerns on its profitability. FA is quite expensive at the moment. It does show a decent growth rate.


Dividend Valuation Growth Profitability Health

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3

1. Profitability

1.1 Basic Checks

FA had positive earnings in the past year.
FA had a positive operating cash flow in the past year.
FA had positive earnings in 4 of the past 5 years.
Each year in the past 5 years FA had a positive operating cash flow.
FA Yearly Net Income VS EBIT VS OCF VS FCFFA Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2019 2020 2021 2022 2023 0 50M -50M 100M 150M 200M

1.2 Ratios

With a Return On Assets value of 0.30%, FA perfoms like the industry average, outperforming 40.51% of the companies in the same industry.
FA has a worse Return On Equity (0.53%) than 60.76% of its industry peers.
FA has a worse Return On Invested Capital (2.37%) than 63.29% of its industry peers.
FA had an Average Return On Invested Capital over the past 3 years of 3.60%. This is significantly below the industry average of 13.65%.
Industry RankSector Rank
ROA 0.3%
ROE 0.53%
ROIC 2.37%
ROA(3y)2.19%
ROA(5y)1.62%
ROE(3y)3.76%
ROE(5y)N/A
ROIC(3y)3.6%
ROIC(5y)N/A
FA Yearly ROA, ROE, ROICFA Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2019 2020 2021 2022 2023 0 10 -10 -20 -30

1.3 Margins

FA has a worse Profit Margin (0.65%) than 60.76% of its industry peers.
FA's Operating Margin of 6.31% is in line compared to the rest of the industry. FA outperforms 55.70% of its industry peers.
FA has a Gross Margin of 49.48%. This is comparable to the rest of the industry: FA outperforms 59.49% of its industry peers.
In the last couple of years the Gross Margin of FA has remained more or less at the same level.
Industry RankSector Rank
OM 6.31%
PM (TTM) 0.65%
GM 49.48%
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y0.37%
GM growth 5YN/A
FA Yearly Profit, Operating, Gross MarginsFA Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2019 2020 2021 2022 2023 0 20 40

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6

2. Health

2.1 Basic Checks

FA has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for FA has been reduced compared to 1 year ago.
Compared to 1 year ago, FA has a worse debt to assets ratio.
FA Yearly Shares OutstandingFA Yearly Shares OutstandingYearly Shares Outstanding 2019 2020 2021 2022 2023 50M 100M 150M
FA Yearly Total Debt VS Total AssetsFA Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2019 2020 2021 2022 2023 500M 1B 1.5B

2.2 Solvency

FA has an Altman-Z score of 3.39. This indicates that FA is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 3.39, FA is in the better half of the industry, outperforming 63.29% of the companies in the same industry.
The Debt to FCF ratio of FA is 3.95, which is a good value as it means it would take FA, 3.95 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of FA (3.95) is comparable to the rest of the industry.
A Debt/Equity ratio of 0.61 indicates that FA is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.61, FA is doing worse than 62.03% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 0.61
Debt/FCF 3.95
Altman-Z 3.39
ROIC/WACC0.26
WACC9.24%
FA Yearly LT Debt VS Equity VS FCFFA Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2019 2020 2021 2022 2023 0 200M 400M 600M 800M 1B

2.3 Liquidity

A Current Ratio of 3.85 indicates that FA has no problem at all paying its short term obligations.
Looking at the Current ratio, with a value of 3.85, FA belongs to the top of the industry, outperforming 94.94% of the companies in the same industry.
FA has a Quick Ratio of 3.85. This indicates that FA is financially healthy and has no problem in meeting its short term obligations.
FA's Quick ratio of 3.85 is amongst the best of the industry. FA outperforms 94.94% of its industry peers.
Industry RankSector Rank
Current Ratio 3.85
Quick Ratio 3.85
FA Yearly Current Assets VS Current LiabilitesFA Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2019 2020 2021 2022 2023 100M 200M 300M 400M 500M

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5

3. Growth

3.1 Past

FA shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -7.92%.
Looking at the last year, FA shows a decrease in Revenue. The Revenue has decreased by -2.35% in the last year.
Measured over the past years, FA shows a quite strong growth in Revenue. The Revenue has been growing by 14.47% on average per year.
EPS 1Y (TTM)-7.92%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%-7.14%
Revenue 1Y (TTM)-2.35%
Revenue growth 3Y14.47%
Revenue growth 5YN/A
Sales Q2Q%-0.64%

3.2 Future

FA is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 14.18% yearly.
Based on estimates for the next years, FA will show a very strong growth in Revenue. The Revenue will grow by 22.69% on average per year.
EPS Next Y-10.74%
EPS Next 2Y1.36%
EPS Next 3Y7.96%
EPS Next 5Y14.18%
Revenue Next Year12.97%
Revenue Next 2Y43.09%
Revenue Next 3Y30.05%
Revenue Next 5Y22.69%

3.3 Evolution

When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
FA Yearly Revenue VS EstimatesFA Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2019 2020 2021 2022 2023 2024 2025 2026 2027 500M 1B 1.5B
FA Yearly EPS VS EstimatesFA Yearly EPS VS EstimatesYearly EPS VS Estimates 2019 2020 2021 2022 2023 2024 2025 2026 2027 0.5 1 1.5

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3

4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 19.61, the valuation of FA can be described as rather expensive.
FA's Price/Earnings is on the same level as the industry average.
FA is valuated rather cheaply when we compare the Price/Earnings ratio to 29.63, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 17.75 indicates a rather expensive valuation of FA.
Compared to the rest of the industry, the Price/Forward Earnings ratio of FA is on the same level as its industry peers.
When comparing the Price/Forward Earnings ratio of FA to the average of the S&P500 Index (22.68), we can say FA is valued slightly cheaper.
Industry RankSector Rank
PE 19.61
Fwd PE 17.75
FA Price Earnings VS Forward Price EarningsFA Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20 25

4.2 Price Multiples

The rest of the industry has a similar Enterprise Value to EBITDA ratio as FA.
60.76% of the companies in the same industry are more expensive than FA, based on the Price/Free Cash Flow ratio.
Industry RankSector Rank
P/FCF 22.22
EV/EBITDA 20.42
FA Per share dataFA EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 2 4

4.3 Compensation for Growth

PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y1.36%
EPS Next 3Y7.96%

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0

5. Dividend

5.1 Amount

No dividends for FA!.
Industry RankSector Rank
Dividend Yield N/A

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FIRST ADVANTAGE CORP

NASDAQ:FA (2/21/2025, 8:16:33 PM)

After market: 18.24 0 (0%)

18.24

-0.5 (-2.67%)

Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryProfessional Services
Earnings (Last)11-12 2024-11-12/bmo
Earnings (Next)02-26 2025-02-26/amc
Inst Owners41.08%
Inst Owner Change17.67%
Ins Owners2.77%
Ins Owner Change-1.97%
Market Cap3.15B
Analysts81.18
Price Target22.27 (22.09%)
Short Float %7.38%
Short Ratio8.42
Dividend
Industry RankSector Rank
Dividend Yield N/A
Yearly Dividend1.48
Dividend Growth(5Y)N/A
DP5.1%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-1.24%
Min EPS beat(2)-2.71%
Max EPS beat(2)0.24%
EPS beat(4)1
Avg EPS beat(4)-3.01%
Min EPS beat(4)-6.74%
Max EPS beat(4)0.24%
EPS beat(8)3
Avg EPS beat(8)-1.51%
EPS beat(12)5
Avg EPS beat(12)2.01%
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)0
Avg Revenue beat(2)-4.13%
Min Revenue beat(2)-5.38%
Max Revenue beat(2)-2.89%
Revenue beat(4)0
Avg Revenue beat(4)-4.58%
Min Revenue beat(4)-6.83%
Max Revenue beat(4)-2.89%
Revenue beat(8)0
Avg Revenue beat(8)-3.58%
Revenue beat(12)2
Avg Revenue beat(12)-1.9%
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)0%
PT rev (3m)12.93%
EPS NQ rev (1m)-3.5%
EPS NQ rev (3m)-20.87%
EPS NY rev (1m)-0.29%
EPS NY rev (3m)-5.66%
Revenue NQ rev (1m)5.6%
Revenue NQ rev (3m)49.24%
Revenue NY rev (1m)0%
Revenue NY rev (3m)13.08%
Valuation
Industry RankSector Rank
PE 19.61
Fwd PE 17.75
P/S 4.17
P/FCF 22.22
P/OCF 18.46
P/B 3.42
P/tB N/A
EV/EBITDA 20.42
EPS(TTM)0.93
EY5.1%
EPS(NY)1.03
Fwd EY5.63%
FCF(TTM)0.82
FCFY4.5%
OCF(TTM)0.99
OCFY5.42%
SpS4.38
BVpS5.33
TBVpS-1.18
PEG (NY)N/A
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA 0.3%
ROE 0.53%
ROCE 3.1%
ROIC 2.37%
ROICexc 2.97%
ROICexgc 34.89%
OM 6.31%
PM (TTM) 0.65%
GM 49.48%
FCFM 18.75%
ROA(3y)2.19%
ROA(5y)1.62%
ROE(3y)3.76%
ROE(5y)N/A
ROIC(3y)3.6%
ROIC(5y)N/A
ROICexc(3y)4.38%
ROICexc(5y)N/A
ROICexgc(3y)31.58%
ROICexgc(5y)N/A
ROCE(3y)4.72%
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y0.37%
GM growth 5YN/A
F-Score6
Asset Turnover0.46
Health
Industry RankSector Rank
Debt/Equity 0.61
Debt/FCF 3.95
Debt/EBITDA 3.28
Cap/Depr 23.44%
Cap/Sales 3.82%
Interest Coverage 0.99
Cash Conversion 99.87%
Profit Quality 2888.56%
Current Ratio 3.85
Quick Ratio 3.85
Altman-Z 3.39
F-Score6
WACC9.24%
ROIC/WACC0.26
Cap/Depr(3y)19.56%
Cap/Depr(5y)27.16%
Cap/Sales(3y)3.5%
Cap/Sales(5y)3.49%
Profit Quality(3y)474.46%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-7.92%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%-7.14%
EPS Next Y-10.74%
EPS Next 2Y1.36%
EPS Next 3Y7.96%
EPS Next 5Y14.18%
Revenue 1Y (TTM)-2.35%
Revenue growth 3Y14.47%
Revenue growth 5YN/A
Sales Q2Q%-0.64%
Revenue Next Year12.97%
Revenue Next 2Y43.09%
Revenue Next 3Y30.05%
Revenue Next 5Y22.69%
EBIT growth 1Y-41%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year160.49%
EBIT Next 3Y69.36%
EBIT Next 5Y54.7%
FCF growth 1Y-20.87%
FCF growth 3Y55.55%
FCF growth 5YN/A
OCF growth 1Y-17.83%
OCF growth 3Y44.83%
OCF growth 5YN/A