Why First Advantage Stock Is Soaring Today
Why First Advantage Stock Is Soaring Today
Scott Levine, The Motley FoolThu, May 7, 2026 at 4:05 PM UTC
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Key Points -
First Advantage reported surprisingly strong first-quarter 2026 financial results.
Management provided auspicious 2026 guidance.
10 stocks we like better than First Advantage ›
Climbing to a price it hasn't reached since January, FirstAdvantage (NASDAQ: FA) stock is ripping notably higher today. Shares of the artificial intelligence (AI) data and software specialist are shining brightly on investors' radars after the company reported better-than-expected first-quarter 2026 financial results.
As of 10:34 a.m. ET, shares of First Advantage are up 18.8%.
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A record quarter is just one of the factors motivating investors
Attaining a new high-water mark for first-quarter sales, First Advantage reported Q1 2026 revenue of $385 million, an 8.6% year-over-year increase. The company's performance exceeded analysts' expectations, which had forecast $373 million in top-line revenue.
Speaking to the strong sales growth, Scott Staples, First Advantage's CEO, stated in the Q1 2026 financial results press release: "Our sales engine is clearly humming. Our verticalized go-to-market strategy and diversified customer base, with our focus on enterprise customers, have enabled us to consistently outpace broader hiring market trends."
First Advantage also provided investors with something to celebrate regarding profits. The company reported Q1 2026 adjusted diluted earnings per share (EPS) of $0.26. Representing a 52.9% year-over-year gain, First Advantages Q1 2026 adjusted diluted EPS surpassed analysts' estimates that it would report $0.21.
With its FA 5.0 growth strategy -- including the implementation of agentic AI solutions -- management foresees a bright 2026, forecasting year-over-year revenue growth of 3% to 8% and adjusted diluted EPS growth of 11% to 20% over 2025.
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Don't dismiss First Advantage stock
While First Advantage stock is moving higher today, it's far from too late for those looking to start a position in the AI stock. Shares of First Advantage are trading at 9.9 times operating cash flow, a discount to their five-year average cash flow multiple of 14.6.
Should you buy stock in First Advantage right now?
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Scott Levine has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
Source: “AOL Money”
