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1. Company Snapshot

1.a. Company Description

Sterling Check Corp.provides technology-enabled background and identity verification services in the United States, Canada, Europe, the Middle East and Africa, and the Asia Pacific.The company offers identity verification services, such as telecom and device verification, identification document verification, facial recognition with biometric matching, social security number verification, and live video chat identification proofing; fingerprinting; background checks, including criminal record checks, sex offender registries, civil court records, motor vehicle and driving license records, executive investigations, credit reports, social media searches, and contingent workforce solutions; liens, judgments, and bankruptcies; and sanctions, risk, and compliance checks.


It also provides credential verification services, which include employment verification, education verification, credential verification, professional reference checks, and department of transportation; drug and health screening; onboarding solutions, including Sterling I-9 that integrates a suite of screening and onboarding services and onboarding forms; and workforce, medical license, and motor vehicle records monitoring solutions.The company's services are delivered through its cloud-based technology platform that empowers organizations with real-time and data-driven insights to conduct and manage their employment screening programs.It serves a client base in 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.


The company was formerly known as Sterling Ultimate Parent Corp.and changed its name to Sterling Check Corp.in August 2021.


Sterling Check Corp.was founded in 1975 and is headquartered in New York, New York.

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1.b. Last Insights on STER

Recent developments at Sterling Check Corp. have been influenced by the company's Q2 earnings release, which reported earnings of $0.23 per share, missing estimates. Despite this, the company's fundamentals remain strong, with a growing demand for its background screening and verification services. However, the company is currently under investigation by The Schall Law Firm for potential breaches of fiduciary duty on the part of its directors and management, which may pose a risk to investors.

1.c. Company Highlights

2. Transcript Summary

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3. NewsRoom

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Is the Options Market Predicting a Spike in Sterling Check (STER) Stock?

Sep -20

Source: zacks.com

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Sterling Check Corp. (STER) Misses Q2 Earnings Estimates

Aug -08

Source: zacks.com

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The Schall Law Firm Begins Investigation Into Allegations Against Sterling Check Corp And Encourages Investors To Initiate Contact

Jun -28

Source: accesswire.com

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The Schall Law Firm Initiates Inquiry Into Claims Against Sterling Check Corp And Urges Affected Investors To Establish Communication

Jun -26

Source: accesswire.com

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The Schall Law Firm Begins Investigation Into Allegations Against Sterling Check Corp And Encourages Investors To Initiate Contact

Jun -25

Source: accesswire.com

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The Schall Law Firm Initiates Probe Into Claims Against Sterling Check Corp And Urges Investors To Establish Communication

Jun -24

Source: accesswire.com

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The Schall Law Firm Starts Investigation Into Allegations Against Sterling Check Corp And Encourages Investors To Connect

Jun -23

Source: accesswire.com

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The Schall Law Firm Begins Probe Into Claims Against Sterling Check Corp And Urges Investors To Reach Out

Jun -21

Source: accesswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.00%)

6. Segments

Screening Services

Expected Growth: 8%

Sterling Check Corp.'s 8% growth in Screening Services is driven by increasing demand for pre-employment background checks, expansion into new markets, and growing adoption of digital screening solutions. Additionally, stringent regulations and compliance requirements in industries such as healthcare and finance are fueling growth.

Other

Expected Growth: 8%

Sterling Check Corp's 8% growth is driven by increasing demand for pre-employment screening services, expansion into new markets, and strategic acquisitions. The company's focus on technology innovation, customer satisfaction, and compliance with changing regulations also contribute to its growth. Additionally, the rise of the gig economy and increasing need for background checks in various industries further fuel the company's growth.

7. Detailed Products

Background Checks

Comprehensive background checks for employment, tenant, and volunteer screening

Identity Verification

Verify identities through various methods, including biometric, document, and database checks

Drug and Health Screening

Pre-employment and random drug testing, as well as health screening services

Compliance and Risk Management

Compliance and risk management solutions for industries with high regulatory requirements

Onboarding and Post-Hire Solutions

Streamline the onboarding process and manage post-hire tasks, including I-9 verification and tax credit services

International Screening

Background checks and verification services for international candidates and employees

8. Sterling Check Corp.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Sterling Check Corp. operates in a highly competitive industry, but the threat of substitutes is mitigated by the company's strong brand recognition and customer loyalty.

Bargaining Power Of Customers

Sterling Check Corp. has a large customer base, but the bargaining power of customers is high due to the availability of alternative services and the high switching costs.

Bargaining Power Of Suppliers

Sterling Check Corp. has a diversified supplier base, which reduces the bargaining power of suppliers. The company's strong relationships with suppliers also mitigate the risk of supply chain disruptions.

Threat Of New Entrants

The threat of new entrants is moderate due to the high barriers to entry in the industry, including regulatory hurdles and the need for significant capital investments.

Intensity Of Rivalry

The intensity of rivalry in the industry is high due to the presence of several established players, leading to a highly competitive market.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 41.55%
Debt Cost 3.95%
Equity Weight 58.45%
Equity Cost 6.37%
WACC 5.36%
Leverage 71.09%

11. Quality Control: Sterling Check Corp. passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Value: 6.2

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Quality: 5.5

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Sterling Check

A-Score: 3.4/10

Value: 3.2

Growth: 7.1

Quality: 2.7

Yield: 0.0

Momentum: 5.0

Volatility: 2.3

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

16.74$

Current Price

16.74$

Potential

-0.00%

Expected Cash-Flows