First Advantage (NYSE:FA) & Upwork (NASDAQ:UPWK) Critical Survey

First Advantage (NYSE:FA) and Upwork (NASDAQ:UPWK) are both industrials companies, but which is the better investment? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, earnings, profitability, dividends, risk and institutional ownership.

Profitability

This table compares First Advantage and Upwork’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Advantage	0.65%	13.16%	7.33%
Upwork	12.94%	16.70%	7.94%

Earnings and Valuation

This table compares First Advantage and Upwork”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Advantage	$1.66 billion	2.19	$37.29 million	$0.14	151.57
Upwork	$787.28 million	1.38	$115.43 million	$0.77	11.32

Upwork has lower revenue, but higher earnings than First Advantage. Upwork is trading at a lower price-to-earnings ratio than First Advantage, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings and target prices for First Advantage and Upwork, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Advantage	0	2	3	1	2.83
Upwork	1	9	3	0	2.15

First Advantage currently has a consensus price target of $23.33, suggesting a potential upside of 9.96%. Upwork has a consensus price target of $13.05, suggesting a potential upside of 49.66%. Given Upwork’s higher probable upside, analysts plainly believe Upwork is more favorable than First Advantage.

Institutional and Insider Ownership

94.9% of First Advantage shares are owned by institutional investors. Comparatively, 77.7% of Upwork shares are owned by institutional investors. 4.4% of First Advantage shares are owned by insiders. Comparatively, 4.9% of Upwork shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Risk & Volatility

First Advantage has a beta of 1.15, indicating that its share price is 15% more volatile than the S&P 500. Comparatively, Upwork has a beta of 1.01, indicating that its share price is 1% more volatile than the S&P 500.

About First Advantage

First Advantage Corporation provides employment background screening, identity, and verification solutions worldwide. It offers pre-onboarding products and solutions, such as criminal background checks, drug/health screening, extended workforce screening, FBI channeling, identity checks and biometric fraud mitigation tools, education/work history verification, driver records and compliance, healthcare credentials, executive screening, and other screening products. The company also provides post-onboarding solutions, including criminal records monitoring, healthcare sanctions, motor vehicle records, social media screening, and global sanctions and licenses; and other products comprising fleet/vehicle compliance, hiring tax credits and incentives, resident/tenant screening, and investigative research. Its products and solutions are used by personnel in recruiting, human resources, risk, compliance, vendor management, safety, and/or security in global enterprises, mid-sized, and small companies. The company was formerly known as Fastball Intermediate, Inc. and changed its name to First Advantage Corporation in March 2021. First Advantage Corporation was founded in 2002 and is based in Atlanta, Georgia.

About Upwork

Upwork Inc., together with its subsidiaries, operates a work marketplace that connects businesses with various independent professionals and agencies in the United States, India, the Philippines, and internationally. The company’s work marketplace provides access to talent with various skills across a range of categories, including administrative support, sales and marketing, design and creative, and customer service, as well as web, mobile, and software development. Its work marketplace also enables clients to streamline workflows, such as talent sourcing, outreach, and contracting. The company’s work marketplace offers access to various functionalities for remote engagements with talent, including communication and collaboration, ability to receive talent invoices through their work marketplace, and payment protection. Its marketplace offerings include Upwork Payroll and Upwork Enterprise, as well as managed and escrow services. The company was formerly known as Elance-oDesk, Inc. and changed its name to Upwork Inc. in May 2015. Upwork Inc. was incorporated in 2013 and is headquartered in San Francisco, California.