Geo Group (NYSE:GEO) Shares Gap Down - What's Next?

Key Points

• GEO shares opened sharply lower, at $26.15 versus the prior close of $28.07, then traded at $27.165.
• Analyst sentiment remained broadly positive: MarketBeat reported an average Buy rating and a $40 price target, though ratings ranged from Strong Buy to Hold.
• The company beat quarterly estimates, reporting EPS of $0.37 versus $0.29 expected and revenue of $732.07 million, up 15.1% year over year.

Geo Group Inc (The) (NYSE:GEO - Get Free Report)'s stock price gapped down before the market opened on Wednesday. The stock had previously closed at $28.07, but opened at $26.15. Geo Group shares last traded at $27.1650, with a volume of 863,876 shares.

Analyst Ratings Changes

GEO has been the subject of several recent research reports. UBS Group reaffirmed a "buy" rating on shares of Geo Group in a research note on Tuesday, October 6th. JonesTrading reiterated a "buy" rating and set a $40.00 target price on shares of Geo Group in a research report on Tuesday, October 6th. Zacks Research raised shares of Geo Group from a "hold" rating to a "strong-buy" rating in a report on Monday, July 20th. Weiss Ratings restated a "hold (c+)" rating on shares of Geo Group in a research report on Friday, September 4th. 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 equities research analyst has rated the stock with a Strong Buy rating, four have given a Buy rating and one has issued a Hold rating to the stock. According to data from MarketBeat, the company has an average rating of "Buy" and an average price target of $40.00.

Geo Group Stock Performance

The company has a debt-to-equity ratio of 1.00, a current ratio of 1.65 and a quick ratio of 1.65. The company's 50-day moving average price is $30.37 and its two-hundred day moving average price is $24.35. The company has a market capitalization of $3.65 billion, a price-to-earnings ratio of 13.09, a PEG ratio of 1.50 and a beta of 0.78.

Geo Group (NYSE:GEO - Get Free Report) 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, equities research analysts anticipate that Geo Group Inc will post 1.33 EPS for the current fiscal year.

Insider Activity

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

Institutional Inflows and Outflows

A number of hedge funds have recently added to or reduced their stakes in the stock. GAMMA Investing LLC increased its position in Geo Group by 6.6% during the third quarter. GAMMA Investing LLC now owns 10,098 shares of the real estate investment trust's stock valued at $308,000 after acquiring an additional 629 shares during the last quarter. Parallel Advisors LLC boosted its stake in shares of Geo Group by 165.5% during the 3rd quarter. Parallel Advisors LLC now owns 1,017 shares of the real estate investment trust's stock worth $31,000 after purchasing an additional 634 shares during the period. Public Employees Retirement System of Ohio boosted its stake in shares of Geo Group by 22.7% during the 1st quarter. Public Employees Retirement System of Ohio now owns 3,866 shares of the real estate investment trust's stock worth $65,000 after purchasing an additional 715 shares during the period. Kestra Advisory Services LLC grew its holdings in Geo Group by 2.4% during the 1st quarter. Kestra Advisory Services LLC now owns 30,462 shares of the real estate investment trust's stock valued at $512,000 after purchasing an additional 727 shares during the last quarter. Finally, Bessemer Group Inc. grew its holdings in Geo Group by 111.9% during the 1st quarter. Bessemer Group Inc. now owns 1,723 shares of the real estate investment trust's stock valued at $29,000 after purchasing an additional 910 shares during the last quarter. 76.10% of the stock is owned by hedge funds and other institutional investors.

About Geo Group

The GEO Group, Inc NYSE: GEO is a provider of correctional, detention and community-based services. The company develops and operates secure facilities for government agencies, offering services that can include facility management, housing, transportation, food services, medical care, education and rehabilitation programs.

GEO also provides reentry and community-based services designed to support individuals transitioning from incarceration. Through its electronic monitoring and supervision offerings, the company assists government and law-enforcement agencies with alternatives to secure detention, including GPS monitoring, case management and other post-release support services.

Founded in 1984 as Wackenhut Corrections Corporation, the company adopted the name The GEO Group in 2003.

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