NEW YORK, May 21, 2026, 05:07 EDT
- First Advantage closed Wednesday up 2.55% at $15.28, below its 52-week high of $19.01, before Thursday’s regular Nasdaq session.
- The company’s May 7 results remain the main confirmed catalyst: revenue rose 8.6% in the first quarter and full-year guidance was reaffirmed.
First Advantage Corp shares head into Thursday’s pre-market session with fresh momentum after gaining 2.55% to $15.28 on Wednesday, as investors kept working through the background-screening company’s stronger first-quarter results and a more mixed outside view on valuation.
The move matters now because the stock has been climbing with the broader market but is still being judged against a big question: whether First Advantage can turn post-Sterling scale, cost savings and digital-identity demand into steadier profit growth. Nasdaq lists regular trading from 9:30 a.m. to 4 p.m. Eastern time, with pre-market trade starting at 4 a.m.; the next U.S. market holiday is Memorial Day on May 25.
Wall Street’s tone helped. U.S. indexes rose more than 1% on Wednesday, with the Nasdaq up 1.55%, as chip and technology shares rallied and oil prices eased. “Technology is driving the bus again today,” Carol Schleif, chief market strategist at BMO Private Wealth, told Reuters, adding that investors had shifted back toward the AI trade. Reuters
First Advantage’s own story is more narrow. The Atlanta-based company, which sells employment background screening, digital identity and verification tools, reported first-quarter revenue of $385.2 million, up 8.6% from a year earlier. Net income was $2.2 million, compared with a year-earlier loss of $41.2 million.
Adjusted EBITDA — earnings before interest, taxes, depreciation and amortization, with some costs stripped out — rose 14.3% to $105.3 million. The company also reported adjusted diluted earnings per share of 26 cents, up from 17 cents a year earlier.
Chief Executive Scott Staples said in the results release that the company’s “sales engine is clearly humming” and that First Advantage was outpacing broader hiring-market trends. He pointed to retail and e-commerce, transportation and logistics, and gig-economy customers, as well as 97% customer retention. First Advantage Corporation
The company kept its 2026 outlook unchanged, forecasting revenue of $1.625 billion to $1.700 billion and adjusted diluted EPS of $1.15 to $1.25. Chief Financial Officer Steven Marks said First Advantage was “repurchasing shares and continuing to reduce net leverage,” after buying back $19.5 million of stock in the quarter and making debt prepayments. First Advantage Corporation
Analysts still lean positive. StockAnalysis.com listed a Buy consensus from 10 analysts, with an average 12-month target of $18.14, about 18.7% above Wednesday’s close. It also showed recent target increases from Citi, Stifel, JPMorgan and Barclays after the earnings report.
The competitive backdrop is the old Sterling deal. First Advantage agreed in 2024 to buy rival Sterling Check in a $2.2 billion cash-and-stock transaction, a move aimed at building scale in a market tied closely to hiring volumes and employer compliance needs.
That acquisition now cuts both ways. Sterling contributed $190.4 million of first-quarter revenue, more than the legacy Americas unit’s $172.7 million, but the combined company still carried about $2.06 billion of long-term debt at March 31, a quarterly filing showed.
There is a risk paragraph, and it is not small. If hiring slows, if customers delay onboarding, or if integration savings fade, the stock could lose some of its earnings-led lift. StockStory’s Weixin Lin wrote Wednesday that First Advantage “doesn’t pass our quality test,” citing weak long-term EPS growth, a lower free-cash-flow margin and modest returns on invested capital, even as the stock had returned 16.9% over six months versus 13.2% for the S&P 500. StockStory
For now, the market is giving First Advantage credit for better margins and a firmer balance-sheet message. The next test is whether that holds after regular trading opens, when a small-cap stock with light pre-market liquidity can move quickly and without much warning.
