Last Updated: 10 Nov 2024
Executive Summary
Geo Group Inc. (GEO) is a leading provider of secure facilities, processing centers, and community re-entry centers in the United States, Australia, South Africa, and the United Kingdom. With a market capitalization of $3.54 billion, GEO is a well-established company in the real estate investment trust (REIT) sector. The company's recent financial performance has been mixed, with revenue growth offset by rising costs. The stock price has been volatile in recent months, but it remains above its 52-week low.
Company Overview
GEO Group Inc. was founded in 1984 and is headquartered in Boca Raton, Florida. The company operates a portfolio of over 100 facilities, including prisons, jails, detention centers, and community re-entry centers. GEO also provides a range of services, such as inmate transportation, medical care, and educational programs.
Fundamental Analysis
GEO's financial performance has been mixed in recent years. Revenue has grown steadily, but costs have also risen. In the latest quarter, revenue increased by 0.1% year-over-year to $242.4 million. However, net income declined by 18.8% to $12.5 million. The company's profit margin is thin, at just 1.72%.
GEO's balance sheet is relatively strong. The company has a low debt-to-equity ratio of 0.37 and a current ratio of 1.23. However, the company's return on assets and return on equity are both below average.
Technical Analysis
GEO's stock price has been volatile in recent months, but it remains above its 52-week low. The stock is currently trading at $25.36, which is below its 50-day moving average of $14.45 and its 200-day moving average of $13.87. The relative strength index (RSI) is 45.5, which indicates that the stock is neither overbought nor oversold.
Short Term Outlook
The short-term outlook for GEO is mixed. The company's financial performance has been weak in recent quarters, and the stock price has been volatile. However, the company's balance sheet is strong, and the stock is trading at a discount to its historical valuation.
Long Term Outlook
The long-term outlook for GEO is more positive. The company is a leader in the REIT sector, and it has a strong track record of growth. The company's facilities are essential to the criminal justice system, and they are likely to continue to be in demand in the future.
Analyst Recommendations
Analysts are divided on the outlook for GEO. One analyst has a strong buy rating on the stock, three analysts have buy ratings, and no analysts have sell ratings. The average analyst target price is $19.55, which is below the current stock price.
