First Advantage(US:FA)2025-05-28 13:03Strategic Overview - First Advantage is positioned as a leading provider of global software and data in the HR technology industry, operating in a large and growing market[23, 25] - The company has a pro forma revenue of $1.5 billion and synergized pro forma adjusted EBITDA of $457 million as of LTM 3/31/25[29] - First Advantage addresses a $24 billion+ global total addressable market, with opportunities to outgrow the market's expected 6%-7% growth rate[36] Sterling Acquisition & Synergies - The acquisition of Sterling Check Corp closed on October 31, 2024, with a purchase value of $2.2 billion (77% cash / 23% stock)[71] - The company is increasing its synergy target from the Sterling acquisition to $65 million - $80 million, with $37 million in run rate synergies actioned as of 3/31/2025[81] Financial Performance & Outlook - First Advantage reaffirms its FY25 guidance, projecting total revenues between $1.5 billion and $1.6 billion, and adjusted EBITDA between $410 million and $450 million[208] - The company targets revenue of $1.8 billion - $2.0 billion by 2028, representing a 4%-7% CAGR, and an adjusted EBITDA margin of 31%-32%[83, 228] - First Advantage aims for an adjusted diluted EPS of $1.65 - $2.00 by 2028, a 19%-25% CAGR[83, 228] - The company has a total debt of $2.2 billion and net debt of $2.0 billion as of 3/31/2025, with a revolver availability of $250 million[198] - The company is targeting a net leverage range of 2x – 3x[200]