First Advantage (NYSE:FA) Shares Gap Down - Here's What Happened

Key Points

• First Advantage shares gapped down sharply, opening at $21.14 versus the prior close of $23.59 and later trading near $21.04 on volume of roughly 2.3 million shares.
• Analyst sentiment remains positive overall, with three Buy and three Hold ratings; the stock has a “Moderate Buy” consensus and an average price target of $22.67.
• The company beat quarterly earnings expectations with EPS of $0.35 versus the $0.29 consensus, while revenue rose 14.9% year over year. Institutional investors own a substantial 94.91% of outstanding shares.

First Advantage Co. (NYSE:FA - Get Free Report)'s stock price gapped down prior to trading on Tuesday . The stock had previously closed at $23.59, but opened at $21.14. First Advantage shares last traded at $21.0370, with a volume of 2,322,519 shares traded.

Wall Street Analyst Weigh In

Several analysts recently issued reports on the stock. Needham & Company LLC raised shares of First Advantage from a "hold" rating to a "buy" rating and set a $28.00 price objective for the company in a research note on Thursday, August 6th. Citigroup raised their target price on shares of First Advantage from $15.00 to $18.00 and gave the stock a "neutral" rating in a research note on Monday, May 11th. Stifel Nicolaus set a $18.00 target price on First Advantage in a report on Friday, May 8th. Royal Bank Of Canada increased their target price on shares of First Advantage from $21.00 to $24.00 and gave the stock a "sector perform" rating in a report on Friday. Finally, JPMorgan Chase & Co. raised their price target on shares of First Advantage from $15.00 to $18.00 and gave the company an "overweight" rating in a research report on Friday, May 8th. Three investment analysts have rated the stock with a Buy rating and three have issued a Hold rating to the company. According to data from MarketBeat.com, the stock currently has an average rating of "Moderate Buy" and an average target price of $22.67.

First Advantage Price Performance

The company has a market cap of $3.63 billion, a price-to-earnings ratio of 704.97 and a beta of 1.16. The company's 50 day moving average price is $18.99 and its 200 day moving average price is $14.75. The company has a current ratio of 3.85, a quick ratio of 3.85 and a debt-to-equity ratio of 0.61.

First Advantage (NYSE:FA - Get Free Report) last announced its quarterly earnings data on Thursday, August 6th. The company reported $0.35 EPS for the quarter, beating analysts' consensus estimates of $0.29 by $0.06. First Advantage had a net margin of 0.65% and a return on equity of 13.16%. The business's revenue was up 14.9% compared to the same quarter last year. During the same period in the prior year, the company earned $0.27 earnings per share. First Advantage has set its FY 2026 guidance at 1.23-1.290 EPS. Equities research analysts forecast that First Advantage Co. will post 0.74 earnings per share for the current year.

Insider Activity

In other news, Director James Lindsey Clark sold 4,921 shares of First Advantage stock in a transaction dated Monday, June 8th. The shares were sold at an average price of $15.69, for a total transaction of $77,210.49. Following the completion of the sale, the director directly owned 56,844 shares in the company, valued at $891,882.36. The trade was a 7.97% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which is available through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. 4.40% of the stock is owned by corporate insiders.

Institutional Trading of First Advantage

Several hedge funds and other institutional investors have recently bought and sold shares of FA. Price T Rowe Associates Inc. MD boosted its holdings in shares of First Advantage by 4.3% during the fourth quarter. Price T Rowe Associates Inc. MD now owns 13,954,320 shares of the company's stock worth $202,757,000 after purchasing an additional 572,580 shares during the last quarter. BlackRock Inc. acquired a new position in First Advantage in the second quarter valued at $217,748,000. Capital World Investors increased its stake in First Advantage by 9.4% in the fourth quarter. Capital World Investors now owns 9,098,714 shares of the company's stock valued at $132,204,000 after purchasing an additional 780,200 shares during the last quarter. Alliancebernstein L.P. lifted its position in First Advantage by 18.4% during the third quarter. Alliancebernstein L.P. now owns 6,225,825 shares of the company's stock worth $95,815,000 after buying an additional 969,314 shares during the period. Finally, Cat Rock Capital Management LP lifted its position in First Advantage by 8.9% during the fourth quarter. Cat Rock Capital Management LP now owns 3,342,818 shares of the company's stock worth $48,571,000 after buying an additional 274,449 shares during the period. 94.91% of the stock is owned by hedge funds and other institutional investors.

First Advantage Company Profile

First Advantage is a global provider of background screening, identity verification and workforce risk management solutions. The company delivers a comprehensive suite of services that help employers verify candidate credentials, manage regulatory compliance and mitigate risk throughout the employee lifecycle. Its platform is built to integrate with leading human capital management and applicant tracking systems, enabling a seamless and scalable experience for organizations of all sizes.

The company's core offerings include pre-employment and continuous background screening, digital identity verification, drug and health testing, and ongoing employee monitoring.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.

Continue following MarketBeat

Add MarketBeat as your preferred source on Google to see our latest stories in your feed.

Add As Preferred Source