Sterling Check Corp
NASDAQ:STER

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Sterling Check Corp Logo
Sterling Check Corp
NASDAQ:STER
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Price: 16.74 USD -0.24% Market Closed
Market Cap: 1.6B USD
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Intrinsic Value

The intrinsic value of one STER stock under the Base Case scenario is 23.43 USD. Compared to the current market price of 16.74 USD, Sterling Check Corp is Undervalued by 29%.

The Intrinsic Value is calculated as the average of DCF and Relative values:

STER Intrinsic Value
23.43 USD
Undervaluation 29%
Intrinsic Value
Price
Worst Case
Base Case
Best Case

Valuation Backtest
Sterling Check Corp

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Backtest Conclusion
Very Attractive
Current Valuation
+45%
Avg Valuation
-12%
Worst Valuation
-49%
Best Valuation
+45%

Stock is trading at its lowest valuation over the past 5 years.

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Fundamental Analysis

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Financials
Annual
Quarterly
TTM
Annual
Quarterly
TTM

Balance Sheet Decomposition
Sterling Check Corp

Current Assets 279.3m
Cash & Short-Term Investments 74.2m
Receivables 174.9m
Other Current Assets 30.2m
Non-Current Assets 1.2B
PP&E 12.2m
Intangibles 1.2B
Other Non-Current Assets 14.2m
Current Liabilities 172.3m
Accounts Payable 52.9m
Accrued Liabilities 82.6m
Other Current Liabilities 36.8m
Non-Current Liabilities 556.8m
Long-Term Debt 537.7m
Other Non-Current Liabilities 19.1m
Efficiency

Earnings Waterfall
Sterling Check Corp

Revenue
736.5m USD
Cost of Revenue
-402.8m USD
Gross Profit
333.8m USD
Operating Expenses
-300.2m USD
Operating Income
33.6m USD
Other Expenses
-48.8m USD
Net Income
-15.2m USD

Free Cash Flow Analysis
Sterling Check Corp

Last Value
3-Years Average
FCF Margin
Conversion Rate
Earnings Calls

In Q3 2023, the company reported revenues of $181 million, a 9.4% drop from the previous year. Expected revenues for the year are $720 to $730 million, signaling further declines of 4.5% to 6%. Adjusted EBITDA is projected at $186 to $191 million, with a 4% to 6% decrease, while adjusted net income is anticipated to be $95 to $99 million, down 7% to 11%. Despite these setbacks, the company remains optimistic about achieving a 7% to 8% increase in new client revenue by year-end. They are reaffirming their long-term goals for a 9% to 11% organic revenue increase, margin expansion to 29% to 32%+, and an adjusted net income growth of 15% to 20% annually.

What is Earnings Call?
Fundamental Scores

STER Profitability Score
Profitability Due Diligence

Sterling Check Corp's profitability score is 48/100. The higher the profitability score, the more profitable the company is.

Positive Gross Profit
Positive Free Cash Flow
Positive Revenue Growth Forecast
Negative 1-Year Revenue Growth
48/100
Profitability
Score

Sterling Check Corp's profitability score is 48/100. The higher the profitability score, the more profitable the company is.

STER Solvency Score
Solvency Due Diligence

Sterling Check Corp's solvency score is 35/100. The higher the solvency score, the more solvent the company is.

Long-Term Solvency
Low D/E
Short-Term Solvency
Low Altman Z-Score
35/100
Solvency
Score

Sterling Check Corp's solvency score is 35/100. The higher the solvency score, the more solvent the company is.

Wall St
Price Targets

STER Price Targets Summary
Sterling Check Corp

Wall Street analysts forecast STER stock price to rise over the next 12 months.

According to Wall Street analysts, the average 1-year price target for STER is 16.83 USD with a low forecast of 16.16 USD and a high forecast of 18.38 USD.

Lowest
Price Target
16.16 USD
3% Downside
Average
Price Target
16.83 USD
1% Upside
Highest
Price Target
18.38 USD
10% Upside
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Dividends

Sterling Check Corp
does not pay dividends
Shareholder Yield

Current shareholder yield for STER is .

Shareholder yield represents the total return a company provides to its shareholders, calculated as the sum of dividend yield, buyback yield, and debt paydown yield. What is shareholder yield?

Shareholder Yield
Dividend Yield
No dividends
Buyback Yield
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Average
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Debt Paydown Yield
Lowest
Average
Highest

Ownership

STER Insider Trading
Buy and sell transactions by insiders

Cumulative Transactions Amount
Period Sold Bought Net
3 Months
6 Months
9 Months
12 Months
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Profile

Sterling Check Corp Logo
Sterling Check Corp

Country

United States of America

Industry

Professional Services

Market Cap

1.6B USD

Dividend Yield

0%

Description

Sterling Check Corp. provides technology-enabled background and identity verification services. The company is headquartered in New York City, New York and currently employs 6,000 full-time employees. The company went IPO on 2021-09-23. The firm offers a comprehensive hiring and risk management solution that begins with identity verification, followed by criminal background screening, credential verification, drug and health screening, processing of employee documentation required for onboarding and ongoing risk monitoring. The firm's services are delivered through its purpose-built, cloud-based technology platform that enables organizations with real-time and data-driven insights to conduct and manage employment screening programs. The firm serves a range of industries, such as healthcare, gig economy, financial and business services, industrials, retail, contingent, technology, media and entertainment, transportation and logistics, hospitality, education and government.

Contact

NEW YORK
New York City
1 State Street Plaza, 24th Floor
+18008992272.0
www.sterlingcheck.com

IPO

2021-09-23

Employees

6 000

Officers

CEO & Director
Mr. Joshua L. Peirez
President & COO
Mr. Lou Paglia
Executive VP, Secretary and Chief Legal & Risk Officer
Mr. Steven L. Barnett
Executive VP, Interim CFO & Interim Chief Accounting Officer
Mr. Richard Steven Dziadzio
Executive VP & Chief Technology Officer
Ms. Ivneet Kaur
Executive VP, Chief Administrative Officer & Chief People Officer
Ms. Robyn H. Price Stonehill
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Vice President of Investor Relations
Mr. Judah Efram Sokel C.F.A., CPA
Interim Chief Marketing Officer
Mr. Oded Menkes
Chief Accounting Officer (Leave of Absence)
Ms. Theresa Neri Strong
Chief Strategy Officer
Mr. Peter Lehmann
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See Also

Discover More
What is the Intrinsic Value of one STER stock?

The intrinsic value of one STER stock under the Base Case scenario is 23.43 USD.

Is STER stock undervalued or overvalued?

Compared to the current market price of 16.74 USD, Sterling Check Corp is Undervalued by 29%.

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