The GEO (GEO)

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This prison stock is up 142% since election; here's why
Finbold· 2025-01-23 11:22
Industry Overview - The private prison industry has been a leading sector in the stock market since November 2024, with Geo Group (NYSE: GEO) being a decisive winner of the rally [1] - Geo Group's stock has soared approximately 142% since the election and is up 22.43% year-to-date (YTD) as of January 23 [1] Geo Group's Performance and Drivers - Geo Group's stock price has surged above its 2017 highs, reaching $34.26 at press time, driven by the new administration's immigration policy [2] - The company is expected to benefit directly from the new policy, as it operates immigration detention centers within its portfolio [4] - The 13th Amendment provisions allowing for indentured servitude as punishment remain in place in many U S states, which could lead to an upsurge in cheap labor for private prison companies [5] - Approximately 30% of California's firefighters are inmates, highlighting the recent usage of such labor in the state [6] Analyst Expectations and Ratings - Geo Group's shares are rated as a 'moderate buy' on average on TipRanks, with an average price target of $41.50, forecasting a 20.82% rise in the coming 52 weeks [8] - Only four analyst firms revised their predictions since early October, with Wedbush being the only one to do so in 2025 [9]
The GEO Group: Further Upside Potential From Trump's Immigration Policy
Seeking Alpha· 2025-01-13 20:21
Group 1 - The GEO Group has been previously recommended as a Hold, indicating a cautious stance on the stock [1] - There are signs of revenue growth deterioration for The GEO Group, suggesting potential challenges ahead [1] - The company is focusing on specific strategies, although details are not provided in the text [1] Group 2 - The analysis emphasizes the importance of fundamental bottom-up analysis and quantitative modeling in investment decisions [1] - The objective is to identify asymmetric opportunities in the market, capitalizing on perception gaps [1]
The GEO (GEO) - 2024 Q3 - Quarterly Results
2024-11-13 21:34
Financial Performance - Total revenues for Q3 2024 were $603.1 million, slightly up from $602.8 million in Q3 2023[3] - Net income attributable to GEO for Q3 2024 was $26.3 million, or $0.19 per diluted share, compared to $24.5 million, or $0.16 per diluted share in Q3 2023[2] - Adjusted EBITDA for Q3 2024 was $118.6 million, compared to $118.7 million in Q3 2023[3] - Total revenues for the first nine months of 2024 were $1.82 billion, compared to $1.80 billion for the same period in 2023[8] - Net income attributable to GEO for the first nine months of 2024 was $16.5 million, or $0.11 per diluted share, down from $82.1 million, or $0.55 per diluted share in the same period of 2023[6] - Q3 2024 revenues reached $603,125, a slight increase from $602,785 in Q3 2023, with year-to-date revenues of $1,815,982 compared to $1,804,885 in the same period last year[27] - Operating income for Q3 2024 was $82,371, down from $83,589 in Q3 2023, with year-to-date operating income of $242,078 compared to $268,629 in the prior year[27] - Q3 2024 net income attributable to GEO was $26,320, an increase of 7.3% from $24,519 in Q3 2023[28] - Adjusted EBITDA for Q3 2024 was $118,636, slightly down from $118,670 in Q3 2023, reflecting a decrease of 0.03%[28] Future Projections - The company expects Q4 2024 net income attributable to GEO to be in the range of $0.19 to $0.22 per diluted share, with revenues of $600 million to $610 million[9] - Full year 2024 expected revenues are approximately $2.42 billion, with adjusted net income projected between $0.80 to $0.84 per diluted share[10] - For FY 2024, net income attributable to GEO is projected to be between $40,000 and $45,000[29] - Adjusted EBITDA guidance for FY 2024 is set between $470,000 and $480,000[29] - Total debt, net, is expected to range from $1,675,000 to $1,650,000[29] - The company reported a net interest expense of $182,000 for FY 2024, with an increase to $184,000 projected[29] - Capital expenditures for FY 2024 are estimated to be between $80,000 and $85,000, with growth-related CAPEX at $12,000 to $13,000[29] - Adjusted net income per diluted share for FY 2024 is forecasted to be between $0.80 and $0.84[29] - The weighted average common shares outstanding on a diluted basis is expected to remain at 134,000[29] Debt and Assets - At the end of Q3 2024, GEO's net debt totaled approximately $1.69 billion, with a net leverage of about 3.5 times adjusted EBITDA[12] - Long-term debt decreased to $1,638,686 as of September 30, 2024, down from $1,725,502 at the end of 2023[26] - Cash and cash equivalents were $70,635 as of September 30, 2024, compared to $93,971 at the end of 2023[26] - The company reported a decrease in total current assets to $484,498 from $528,505 at the end of 2023[26] - Interest expense for Q3 2024 was $45,498, down from $55,777 in Q3 2023, indicating improved debt management[27] Operational Updates - Average participant counts under the ISAP program decreased to approximately 177,000 in Q3 2024 from 184,000 in Q2 2024[4] - The Adelanto ICE Processing Center contract was extended through December 19, 2029, employing approximately 350 individuals[11] Strategic Outlook - The company aims to reduce net debt and enhance long-term shareholder value through disciplined capital allocation[25] - Future performance is subject to various risks, including changes in government policy and economic conditions, which may impact financial guidance for 2024[25]
Michael Burry's $10 million slip—Which stock did he sell too soon?
Finbold· 2024-11-08 13:01
As Donald Trump’s victory in the 2024 presidential elections ignited an impressive rally for private prison stocks, an old Michael Burry bet once again came into focus, although, unfortunately, due to all the gains he missed by selling early.Specifically, Geo Group (NYSE: GEO) stock collapsed in value from above $12 to about $7 during the first quarter (Q1) of 2023, prompting ‘The Big Short’ investor to make a $5 million bet in Q2 of the same year.Burry cleared his stake in the private prison company only a ...
The GEO (GEO) - 2024 Q3 - Earnings Call Transcript
2024-11-07 19:20
Financial Data and Key Metrics - Net income attributable to GEO for Q3 2024 was approximately $26 million or $0.19 per diluted share on quarterly revenues of approximately $603 million, compared to $25 million or $0.16 per diluted share in Q3 2023 on similar revenues [31] - Adjusted net income for Q3 2024 was approximately $29 million or $0.21 per diluted share, compared to $24 million or $0.19 per diluted share in Q3 2023 [32] - Adjusted EBITDA for Q3 2024 was approximately $119 million, essentially unchanged from the prior year [32] - Quarterly revenues in owned and leased secure services facilities increased by approximately 6% year-over-year, driven by higher occupancy levels at ICE facilities [33] - Net debt was reduced by approximately $92 million year-to-date, bringing total net debt below $1.7 billion with net leverage at approximately 3.0x adjusted EBITDA [17] Business Segment Data and Key Metrics - Electronic Monitoring and Supervision Services segment saw lower revenues due to reduced participant counts under the ISAP contract, averaging approximately 177,000 in Q3 2024 compared to 184,000 in Q2 2024 [8] - ICE processing centers utilization remained consistent at approximately 13,000 beds in Q3 2024, an 11% increase from the prior year, currently at 13,500 beds [9] - GEO Secure Services has approximately 10,000 available beds at six idle facilities and 8,000 underutilized beds under contract, potentially generating $300 million and $100 million in incremental annualized revenues, respectively [20][22] - GEO Care delivered in-custody rehabilitation programs to approximately 2,500 individuals and enrolled 19,000 in GEO Continuum of Care programs in Q3 2024 [55] Market Data and Key Metrics - Utilization across all ICE facilities nationwide was approximately 37,000 beds in September 2024, below the 41,500 beds funded under the continuing resolution [10] - The ISAP contract utilization is likely below the level supported by the continuing resolution funding of approximately $470 million for alternatives to detention programs [11] - The incoming Trump administration is expected to take a more aggressive approach to border security and interior enforcement, potentially increasing ICE detention funding to support 50,000 beds [12][13] Company Strategy and Industry Competition - The company is focused on reducing debt, deleveraging the balance sheet, and enhancing long-term shareholder value, with plans to reduce net debt by an additional $20 million in Q4 2024 [17][39] - GEO is well-positioned to scale up secure residential care housing from 13,500 beds to over 31,000 beds and expand ISAP participant monitoring from 182,500 to several millions [65] - The company is responding to a procurement for a Federal Immigration Processing center in Newark, New Jersey, expected to result in a 15-year contract [16] Management Commentary on Operating Environment and Future Outlook - The company expects the incoming Trump administration to implement more aggressive immigration policies, potentially increasing demand for GEO's services [13][64] - Federal funding for ICE detention and ISAP programs may increase after the expiration of the continuing resolution, with potential for additional appropriations [11][12] - The company anticipates scaling up services to meet future federal government needs, including secure transportation and electronic monitoring [15][22] Other Important Information - GEO has a long-standing partnership with ICE, providing approximately 40% of secure beds for ICE and having a 20-year history with the ISAP program [65][60] - The company has a strong capital structure with fixed-rate debt representing 76% of total indebtedness and no substantial debt maturities before April 2029 [38] Q&A Session Summary Question: ISAP NOI Margins and Operating Leverage - Margins in the ISAP segment are expected to remain consistent or potentially improve with increased participant counts [68] Question: Air Services Contract Opportunity - The air services contract could theoretically double in size, depending on Congressional funding, with potential for significant revenue growth [69] Question: Decline in Electronic Monitoring Revenues and NOI - The decline in net operating income was attributed to changes in the mix of services and increased staffing requirements for case management services [73][74] Question: Debt Reduction Goals - The company aims to reduce net debt by $150 million to $175 million annually, with $112 million expected in 2024 after accounting for refinancing fees [76][77] Question: Potential Expansion with U.S. Marshals and BOP - In the short term, available capacity will prioritize ICE, but long-term opportunities exist with the U.S. Marshals and BOP for additional bed space [78][79] Question: ISAP Program CapEx and Competition - CapEx requirements for scaling ISAP depend on the type of monitoring devices used, with GEO being the exclusive provider under the current contract [82][83] Question: ISAP Program Ramp-Up Cadence - The ISAP program could potentially double or triple in size, depending on funding availability, with prior participant counts reaching 340,000 [86] Question: ICE Detention Facility Staffing and Costs - Startup costs for reactivating idle facilities include physical plant renovations and labor recruitment, with no significant challenges expected in staffing [95] Question: BOP Opportunities Under New Administration - The Biden administration's prohibition on private sector providers for BOP may be reversed, potentially opening opportunities for GEO [96] Question: Criminal Alien Deportation and Facility Needs - The Trump administration's focus on deporting criminal aliens may require additional secure facilities, with varying levels of security needed [99][101] Question: ISAP Contract Extension - The ISAP contract can be extended for a minimum of six months, potentially up to 18 months, depending on the new administration's priorities [106][107]
Geo Group (GEO) Misses Q3 Earnings and Revenue Estimates
ZACKS· 2024-11-07 13:11
Geo Group (GEO) came out with quarterly earnings of $0.21 per share, missing the Zacks Consensus Estimate of $0.24 per share. This compares to earnings of $0.19 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -12.50%. A quarter ago, it was expected that this private prison operator would post earnings of $0.25 per share when it actually produced earnings of $0.23, delivering a surprise of -8%.Over the last four quarters, the c ...
Gilat Secures Approximately $15 Million in Orders from Leading Satellite Operators for GEO, MEO and LEO Constellations
GlobeNewswire News Room· 2024-10-15 11:02
Core Insights - Gilat Satellite Networks Ltd. has received approximately $15 million in orders from major satellite operators for advanced satellite communications solutions, which will be delivered over the next 18 months [1][2] Company Overview - Gilat is a leading global provider of satellite-based broadband communications with over 35 years of experience, focusing on deep technology solutions for satellite, ground, and new space connectivity [3][4] - The company emphasizes the importance of connectivity for all people and aims to provide communication solutions globally [3] Product Offerings - Gilat's portfolio includes high-value solutions for multiple orbit constellations, featuring very high throughput satellites (VHTS) and software-defined satellites (SDS) [4] - The offerings consist of a cloud-based platform, high-performance satellite terminals, Satellite On-the-Move (SOTM) antennas, Solid State Power Amplifiers (SSPA), Block Upconverters (BUC), and integrated ground systems for both commercial and defense applications [4][5] Market Position - The new orders highlight the strong partnerships Gilat has established with key industry players, reinforcing its position as a trusted provider of satellite technology [2][5] - Continuous demand for innovative satellite communications solutions is noted as operators expand their networks to meet increasing user needs [3]
Osisko Announces Preliminary Q3 2024 GEO Deliveries, Cash Margin and Reduced Debt Balance
GlobeNewswire News Room· 2024-10-08 21:00
MONTRÉAL, Oct. 08, 2024 (GLOBE NEWSWIRE) -- Osisko Gold Royalties Ltd (the "Company" or "Osisko") (OR: TSX & NYSE) is pleased to provide an update on its third quarter 2024 preliminary deliveries, revenues and cash margin, as well as on its cash and debt positions as of September 30th, 2024. All monetary amounts included in this report are expressed in Canadian dollars, unless otherwise noted. Results Release: Wednesday, November 6th, 2024 after market close Dial-in Numbers: (Option 1) North American Toll-F ...
The GEO (GEO) - 2024 Q2 - Quarterly Report
2024-08-08 20:07
Financial Performance - Consolidated revenues for the six months ended June 30, 2024, were $1,212.9 million, compared to $1,202.1 million for the same period in 2023, reflecting a growth of approximately 0.15%[142] - Total revenues for Q2 2024 were $607.2 million, a 2.2% increase from $593.9 million in Q2 2023[149] - Revenues for U.S. Secure Services increased by $64.5 million in the first half of 2024, primarily due to new transportation contracts and increased rates, with total revenues reaching $803.0 million[175] - Net operating revenues for the six months ended June 30, 2024, were $1,105,117 thousand, a slight increase from $1,104,959 thousand in the same period of 2023[209] - The company reported a net loss of $(22,884) thousand for the six months ended June 30, 2024, compared to a net income of $45,962 thousand in the prior year[209] Occupancy and Capacity - The average company-wide facility occupancy rate was approximately 87.8% for the six months ended June 30, 2024, compared to 85.0% for the same period in 2023, indicating an increase in occupancy[142] - The company manages and/or owns approximately 81,000 beds across 100 secure services and community-based facilities as of June 30, 2024[141] - The company has 69,834 active beds and 11,275 idle beds, which includes those being marketed to potential customers, as of June 30, 2024[142] - The company is currently marketing 11,275 vacant beds across ten idle facilities, with a carrying value of $283.5 million[147] - Activating remaining idle facilities could generate approximately $355 million in incremental annualized revenue and increase earnings per share by $0.36 to $0.40[229] Revenue Streams - U.S. Secure Services revenue increased by $29.6 million to $402.1 million, representing 66.2% of total revenue, with an average occupancy rate of 87.7%[150][151] - Electronic Monitoring and Supervision Services revenue decreased by $23.3 million to $84.7 million, primarily due to lower participant counts[152] - Reentry Services revenue increased by $1.4 million to $69.0 million, driven by new contracts and increased census levels[153] - International Services revenue rose by $5.7 million to $51.4 million, mainly due to increased populations in Australia[154] Expenses and Liabilities - Operating expenses totaled $443.5 million, a 3.6% increase from $428.1 million in Q2 2023, with U.S. Secure Services expenses rising by $15.3 million[155] - General and administrative expenses increased by $10.5 million to $52.2 million, primarily due to transaction fees and compensation adjustments[165] - Operating expenses represented approximately 73% of consolidated revenues for the six months ended June 30, 2024, compared to 72% for the same period in 2023[227] - General and administrative expenses accounted for approximately 9% of consolidated revenues for the six months ended June 30, 2024, up from 8% in 2023[228] - The company’s operations are exposed to various liabilities, including legal claims and proceedings, which could adversely affect its financial condition[136] Debt and Financing - The company completed a private offering of $1.275 billion in senior notes on April 18, 2024, including $650 million of 8.625% senior secured notes due 2029 and $625 million of 10.250% senior notes due 2031[201] - The net proceeds from the senior notes offering were used to refinance approximately $1.5 billion of existing indebtedness, extending debt maturities to 2029 and 2031[202] - The company has approximately $484.4 million in borrowings under its Credit Agreement, with a potential $5 million increase in annual interest expense for every 1% rise in interest rates[230] - Loss on extinguishment of debt was approximately $82.4 million in Six Months 2024, representing 6.8% of revenue, compared to a loss of $1.754 million (0.1% of revenue) in Six Months 2023, an increase of 4596.6%[192] Tax and Income - The effective tax rate for Q2 2024 was 37.9%, with a tax benefit of $20.4 million due to pre-tax losses, compared to a benefit of $11.2 million and an effective rate of 28.5% in Q2 2023[172] - The effective tax rate for Six Months 2024 was 53.4%, with a tax benefit of $12.308 million, compared to a tax provision of $23.515 million (29.9% effective rate) in Six Months 2023, a change of 152.3%[196] - Income from operations decreased to $142,249 thousand for the six months ended June 30, 2024, compared to $174,568 thousand for the same period in 2023[209] Future Outlook and Risks - The company is focused on developing new facilities based on contract awards, utilizing its project development expertise[140] - The company faces risks related to government appropriations and budgetary constraints that may impact its financial condition[136] - Future budgetary pressures may impact the company's operations and ability to pursue new business opportunities due to potential reductions in per diem rates and contract modifications[221] - The company is exploring opportunities for future business acquisitions or dispositions, which may require additional financing or refinancing of existing debt[207]
The GEO (GEO) - 2024 Q2 - Earnings Call Transcript
2024-08-07 18:22
Financial Data and Key Metrics Changes - The company reported a GAAP net loss of approximately $32.5 million, or $0.25 per diluted share, on revenues of approximately $607 million for Q2 2024 [21] - Adjusted net income for Q2 2024 was approximately $30 million, or $0.23 per diluted share, with adjusted EBITDA of approximately $119 million [21][22] - The company expects full-year 2024 adjusted net income to be in the range of $0.82 to $0.93 per diluted share, with annual revenues of approximately $2.44 billion [24] Business Line Data and Key Metrics Changes - Revenues in the managed-only segment increased by approximately 11% year-over-year, driven by new contracts [5][22] - Revenues for the owned and leased secure services segment increased by approximately 7% year-over-year, primarily due to higher occupancy levels [22] - The electronic monitoring and supervision services segment saw a decrease in revenues due to a decline in participants under the ISAP program [7][22] Market Data and Key Metrics Changes - Utilization of ICE facilities remained stable at approximately 13,000 beds, representing a 30% increase from the previous year [6] - Nationwide utilization across all ICE facilities is estimated at approximately 37,000 beds, below the funded level of 41,500 beds [6][9] - The U.S. House of Representatives has proposed increasing funding for ICE detention to 50,000 beds for fiscal year 2025 [8] Company Strategy and Development Direction - The company aims to reduce debt by $100 million to $125 million in 2024, targeting a total net debt of approximately $1.65 billion [12][27] - The focus remains on providing high-quality services to ICE and exploring growth opportunities in response to evolving policy priorities [15][19] - The company has a long-standing partnership with ICE and is positioned to respond to government agency needs with a diversified service platform [19][45] Management's Comments on Operating Environment and Future Outlook - Management noted financial constraints affecting ICE's utilization of beds and participation levels, expecting improvements with the new fiscal year [9][52] - The company anticipates a gradual increase in utilization rates for ICE detention beds and monitoring participants in Q4 2024 [25] - Management expressed confidence in the company's ability to adapt to new administration policies and expand operations as needed [70][72] Other Important Information - The company completed a comprehensive refinancing of its debt, significantly enhancing its balance sheet and lowering the cost of debt [11][44] - The average age of the company's facilities is 20 years, with a combined replacement value exceeding $6 billion [17] - The company has 10,000 idle beds that could provide significant revenue upside if reactivated [17][45] Q&A Session Summary Question: Developments on the ISAP contract renewal - Management is aware of discussions on crafting a new RFP but notes potential changes with a new administration [47] Question: Expansion of air operations with ICE - Current capabilities are in place to scale operations if requested by ICE, but no further information is available [48] Question: Smaller scale opportunities at state and local levels - Interest has been noted among state partners for additional capacity, particularly regarding idle facilities [49] Question: Clarification on guidance assumptions - Q3 is expected to be flat, with potential increases in Q4 driven by budget replenishment [52][66] Question: Likelihood of returning capital to shareholders - The focus remains on debt reduction, with potential for capital return evaluated in 2025 [67][72]