First Advantage Corporation Fundamental Analysis
First Advantage Corporation (FA) shows weak financial fundamentals with a PE ratio of 319.37, profit margin of 0.53%, and ROE of 0.66%. The company generates $1.6B in annual revenue with strong year-over-year growth of 83.02%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 52.9/100 based on profitability, valuation, growth, and balance sheet metrics. The C grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze FA's fundamental strength across five key dimensions:
Efficiency Score
WeakFA struggles to generate sufficient returns from assets.
Valuation Score
ModerateFA shows balanced valuation metrics.
Growth Score
ExcellentFA delivers strong and consistent growth momentum.
Financial Health Score
ExcellentFA maintains a strong and stable balance sheet.
Profitability Score
ModerateFA maintains healthy but balanced margins.
Key Financial Metrics
Is FA Expensive or Cheap?
P/E Ratio
FA trades at 319.37 times earnings. This suggests a premium valuation.
PEG Ratio
When adjusting for growth, FA's PEG of 0.98 indicates potential undervaluation.
Price to Book
The market values First Advantage Corporation at 2.11 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 7.06 times EBITDA. This is generally considered low.
How Well Does FA Make Money?
Net Profit Margin
For every $100 in sales, First Advantage Corporation keeps $0.53 as profit after all expenses.
Operating Margin
Core operations generate 9.95 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $0.66 in profit for every $100 of shareholder equity.
ROA
First Advantage Corporation generates $0.23 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
First Advantage Corporation produces operating cash flow of $222.02M, showing steady but balanced cash generation.
Free Cash Flow
First Advantage Corporation generates strong free cash flow of $215.69M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $1.26 in free cash annually.
FCF Yield
FA converts 8.07% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
319.37
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
0.98
vs 25 benchmark
P/B Ratio
Price to book value ratio
2.11
vs 25 benchmark
P/S Ratio
Price to sales ratio
1.68
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.006
vs 25 benchmark
Current Ratio
Current assets to current liabilities
2.65
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.007
vs 25 benchmark
ROA
Return on assets percentage
0.002
vs 25 benchmark
ROCE
Return on capital employed
0.04
vs 25 benchmark
How FA Stacks Against Its Sector Peers
| Metric | FA Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 319.37 | 25.99 | Worse (Expensive) |
| ROE | 0.66% | 1259.00% | Weak |
| Net Margin | 0.53% | -34891.00% (disorted) | Weak |
| Debt/Equity | 0.01 | 0.74 | Strong (Low Leverage) |
| Current Ratio | 2.65 | 9.71 | Strong Liquidity |
| ROA | 0.23% | -1482943.00% (disorted) | Weak |
FA outperforms its industry in 2 out of 6 key metrics, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews First Advantage Corporation's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
172.90%
Industry Style: Cyclical, Value, Infrastructure
High GrowthEPS CAGR
63.42%
Industry Style: Cyclical, Value, Infrastructure
High GrowthFCF CAGR
229.66%
Industry Style: Cyclical, Value, Infrastructure
High Growth