This is a much used term and it's getting more and more. When I read it, I read.. "We need somebody who can just fix anything". With anything I mean, "FIX" anything and not "BUILD" anything.
In my opinion you should hire a person for what that person is good at, in the beginning of the web we were "web developers" nowadays we separated in many many groups and expertises. Some developers have more feeling for frontend, backend or any other type of development for the web. I just don't believe somebody can be really good in frontend and backend. Even within frontend developers there different leagues, there are people who love creating visual stuff, animations, technical, logic, and everyone has its good, better and lesser sides or interest.
To say you are a full-stack developer, feels for me as someone who knows about everything a little, but thrives at nothing.
Know about everything, but thrive at nothing.