Geo Group (NYSE:GEO) Stock Falls 7% – Here’s What Happened

Geo Group Inc (The) (NYSE:GEO) fell 7% on Tuesday. The company traded as low as $30.45 and last traded at $30.08. Approximately 1,191,534 shares changed hands during mid-day trading, a decline of 45% from the average daily volume of 2,169,828 shares. The stock had previously closed at $32.34.

Key Stories Impacting Geo Group

Here are the key news stories impacting Geo Group this week:

• Positive Sentiment: $950 million Adelanto facility sale: GEO completed the sale of three California ICE processing facilities totaling 2,644 beds to the U.S. government. The transaction monetizes the properties at a substantial value and provides cash that can be directed toward debt reduction and shareholder returns. GEO Adelanto facility sale announcement
• Positive Sentiment: Expanded share repurchase authorization: GEO increased its share buyback authorization to $1.25 billion. Repurchases could reduce the share count and support earnings per share, although the timing and amount of actual purchases remain uncertain. GEO expands share buyback
• Positive Sentiment: Debt refinancing and repayment: GEO delivered notice to redeem all of its senior secured notes due 2029, reportedly totaling approximately $650 million, and amended and extended its revolving credit facility. Retiring the notes could reduce interest expense and refinancing risk, while the revised credit facility preserves liquidity for operations and capital allocation. GEO debt redemption and credit facility announcement
• Neutral Sentiment: Portfolio implications: Selling Adelanto provides significant liquidity but also removes three operating facilities from GEO’s portfolio, potentially reducing future facility-related revenue and cash flow. The stock’s movement toward its 52-week high indicates investors are currently placing greater weight on the sale proceeds, buyback potential and balance-sheet improvement. GEO sells three facilities to ICE

Analyst Upgrades and Downgrades

A number of equities research analysts have commented on the company. Weiss Ratings reiterated a “hold (c+)” rating on shares of Geo Group in a research report on Friday, September 4th. JonesTrading reaffirmed a “buy” rating and issued a $40.00 price objective on shares of Geo Group in a research note on Tuesday. Northland Securities upped their target price on Geo Group from $30.00 to $40.00 and gave the company an “outperform” rating in a report on Friday, June 26th. UBS Group reissued a “buy” rating on shares of Geo Group in a research report on Tuesday. Finally, Wall Street Zen lowered shares of Geo Group from a “buy” rating to a “hold” rating in a report on Saturday, July 25th. One investment analyst has rated the stock with a Strong Buy rating, four have assigned a Buy rating and one has issued a Hold rating to the company’s stock. According to data from MarketBeat, Geo Group currently has a consensus rating of “Buy” and an average price target of $40.00.

Geo Group Trading Down 6.7%

The firm has a 50-day moving average of $31.26 and a 200 day moving average of $26.37. The company has a market cap of $3.97 billion, a P/E ratio of 14.23, a price-to-earnings-growth ratio of 1.71 and a beta of 0.77. The company has a current ratio of 1.65, a quick ratio of 1.65 and a debt-to-equity ratio of 1.00.

Geo Group (NYSE:GEO) last issued its quarterly earnings results on Thursday, August 6th. The real estate investment trust reported $0.37 earnings per share (EPS) for the quarter, beating the consensus estimate of $0.29 by $0.08. The firm had revenue of $732.07 million for the quarter, compared to analyst estimates of $721.43 million. Geo Group had a return on equity of 10.42% and a net margin of 10.31%.The company’s revenue was up 15.1% compared to the same quarter last year. During the same period in the previous year, the firm earned $0.22 earnings per share. On average, analysts predict that Geo Group Inc will post 1.31 earnings per share for the current fiscal year.

Insiders Place Their Bets

In other Geo Group news, insider Ronald A. Brack sold 7,000 shares of the firm’s stock in a transaction on Friday, August 21st. The shares were sold at an average price of $32.00, for a total value of $224,000.00. Following the completion of the sale, the insider directly owned 71,614 shares in the company, valued at approximately $2,291,648. This trade represents a 8.90% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. Also, VP Matthew Albence sold 11,797 shares of Geo Group stock in a transaction on Friday, September 11th. The shares were sold at an average price of $31.45, for a total transaction of $371,015.65. Following the completion of the sale, the vice president directly owned 87,602 shares of the company’s stock, valued at approximately $2,755,082.90. This trade represents a 11.87% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders sold 28,797 shares of company stock valued at $911,916 over the last 90 days. Corporate insiders own 4.98% of the company’s stock.

Institutional Trading of Geo Group

A number of hedge funds and other institutional investors have recently added to or reduced their stakes in the company. BlackRock Inc. acquired a new position in Geo Group during the 2nd quarter worth approximately $570,744,000. Pentwater Capital Management LP acquired a new stake in Geo Group in the second quarter valued at approximately $312,698,000. Hsbc Holdings PLC bought a new stake in shares of Geo Group during the second quarter valued at approximately $118,673,000. Cooper Creek Partners Management LLC increased its holdings in shares of Geo Group by 14.2% during the first quarter. Cooper Creek Partners Management LLC now owns 5,314,006 shares of the real estate investment trust’s stock valued at $89,328,000 after acquiring an additional 661,281 shares in the last quarter. Finally, Rubric Capital Management LP raised its position in shares of Geo Group by 7.3% during the first quarter. Rubric Capital Management LP now owns 3,743,180 shares of the real estate investment trust’s stock worth $62,923,000 after purchasing an additional 256,265 shares during the period. 76.10% of the stock is owned by institutional investors.

Geo Group Company Profile

The GEO Group, Inc (NYSE: GEO) is a provider of correctional, detention and community-reentry services. The company designs, finances, develops and manages secure facilities for federal, state and local government agencies, as well as certain international government clients. Its facilities house individuals in pretrial detention, immigration detention and correctional programs.

GEO also provides correctional and behavioral healthcare, transportation and security services, and electronic monitoring technologies.