The GEO Group - Don’t Sell, but Don’t Buy Either
Amidst a string of schizophrenic positive-negative-positive news, I closed my position in prison operator The GEO Group (GEO) early last week.
- 9/13/07: The GEO Group Wins Contract Re-Bid for the Continued Management of the 890-Bed Arthur Gorrie Correctional Centre (Australia)
- 9/14/07: New Mexico: Court Rules Against Private Prison
- 9/26/07: The GEO Group Receives Notice of Intent to Award a Contract from the State of Florida for the 384-Bed Expansion of the 1,500-Bed Graceville Correctional Facility
- 9/28/07: Feds Sue Prison Over Muslim Head Scarf Ban
- 10/2/07: The GEO Group Announces Discontinuation of Contract by the Texas Youth Commission for the Management of the 200-Bed Coke County Juvenile Justice Center
- 10/7/07: Why Prison Stocks Look Tempting (Barron’s)
- 10/8/07: Geo Group Will Hold Onto Texas Criminal Justice Contracts, Analyst Says (First Analysis Securities)
Barron’s identified the prison operator sector’s recent weakness as a buying opportunity. I agree that the prison population is more likely growing at the 13% forecast by the Pew Charitable Trusts than the incomplete Census report of a 4% growth. We all know how reliable government data are…just look at other statistics like the Jobs Data. However, with the stock up 70% year-over-year, I wanted to take profits. With such an amazing run and with some increased near-term risk, I’d like to see some consolidation or pullback as these issues work themselves out. I want to observe the following situations from the sidelines and am more than willing to jump back into GEO: Read the rest of this entry »
