Why Did First Advantage Stock Soar 14% Today?

First Advantage Corp FA reported second-quarter revenue growth of 66.5% year-over-year to $174.8 million, beats the consensus of $152.9 million.
Revenue growth was attributable to increasing momentum within the existing customer base, significant new customer growth, and U.K. screening business acquisition contribution.
Adjusted EPS improved to $0.25 from $0.09 in 2Q20, beating the consensus of $0.17.
The company reported income from operations of $17.28 million, compared to the loss of $(6.2) million a year ago.
First Advantage generated cash from operating activities year-to-date of $56.1 million.
Adjusted EBITDA was $56.3 million, compared to $31.7 million in 2Q20.
First Advantage ended the Q2 with cash and cash equivalents of $257.1 million.
Net proceeds of $316.5 million from the IPO were used to prepay $200 million of debt and general corporate purposes.
The company amended its revolving credit facility to increase borrowing capacity to $100.0 million and extend the maturity date from January 31, 2025, to July 31, 2026.
FY21 Outlook: First Advantage expects revenues of $640 million –$650 million, Adjusted EBITDA of $186 million – $190 million, and Adjusted net income of $110 million – $113 million.
Price Action: FA shares are trading higher by 14% at $22.57 on the last check Thursday.

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