The GEO Group (GEO) – First Quarter In-Line but Potential Upside for the Year

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Wednesday, May 08, 2024

The GEO Group, Inc. (NYSE: GEO) is a leading diversified government service provider, specializing in design, financing, development, and support services for secure facilities, processing centers, and community reentry centers in the United States, Australia, South Africa, and the United Kingdom. GEO’s diversified services include enhanced in-custody rehabilitation and post-release support through the award-winning GEO Continuum of Care®, secure transportation, electronic monitoring, community-based programs, and correctional health and mental health care. GEO’s worldwide operations include the ownership and/or delivery of support services for 103 facilities totaling approximately 83,000 beds, including idle facilities and projects under development, with a workforce of up to approximately 18,000 employees.

Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

1Q Results. Total revenues decreased to $605.7 million from $608.2 million last year. We estimated revenue of $604 million. Net income for the quarter was $22.7 million, or $0.17 per diluted share, compared to $28.0 million, or $0.22, in the previous year. Adjusted EBITDA totaled $117.6 million compared to $130.9 million last year. We estimated net income of $23.6 million, or $0.19 per share, and adjusted EBITDA of $120 million.

ICE Populations. For 1Q24, GEO experienced average ICE pops in the 13,000 range, with that number carrying over into the second quarter. After a dip beginning in late March, overall ICE pops have rebounded back to the 37,000 level, according to GEO management. With the typical seasonal increase in crossings, it is possible numbers could trend up to the 41,500 bed authorized level.

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*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 


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