Reasons The GEO Group, Inc. (GEO) Stock Deserves a Closer Look

Stock analysts at JP Morgan cut their rating on shares of The GEO Group, Inc. (NYSE:GEO) from Overweight to a new rating of Neutral in their opinion released on February 15. Analysts at Canaccord Genuity are sticking to their Buy recommendation for the stock. However, on March 08, they lifted target price to $50 from the prior target set at $52. Analysts at Canaccord Genuity, made their first call for this company shares with a Buy rating, according to a research note that dated back to March 08.

Let’s take a glimpse at some insider activity at The GEO Group, Inc. (NYSE:GEO) and observe the pattern. The earliest insider trade happened on 09/03/2019. FOREMAN ANNE N parted with a total of 8 thousand shares of the firm at average share price of $17.24. The total amount for the sale was set at $137.92 thousand. On completing this exchange, the Director account balance was 11.87 thousand shares. The stock lost -5.34 percent from that insider sale. On 08/22/2019, EVANS BRIAN, SVP, CFO, did a sale of 3.47 thousand shares at a price of $17.45 per share. This got rid of 60.52 thousand shares from the insider’s fortune and the stock experienced a -6.48 percent retreat in price since the news became public. This exchange saw 130 thousand shares get out from the SVP, CFO account. On 08/09/2019, Director GLANTON RICHARD H recorded a sale transaction valued at $29.45 thousand. The sale at $17.71 a share has eliminated 1.66 thousand shares from the insider’s portfolio position. Meanwhile, shares price witnessed -7.85 percent decrease since the transaction reporting date. The company insider is left with 11.87 thousand shares remaining in the account. GLANTON RICHARD H, who works as Director at the company, performed a sale of 2.4 thousand shares in a transaction worth $51.34 thousand. The disposal recorded on 05/17/2019 was priced at $21.39 per share. The stock price plunged -23.7 percent since the transaction. GLANTON RICHARD H currently holds a stake of 11.87 thousand in GEO stock which is worth $193.78 thousand after the insider selling.

The GEO Group, Inc. (GEO) is most likely going to rise 40.93 percent in the coming 12 months, as per price target approximations compiled by finviz. Nevertheless, they have set the price target at a $23-month high price target. This represents a whopping 40.93 percent increase from the current trading of shares. The 52-week median price target given by the analysts is $23, which means a return possibility of 40.93 percent in comparison with the closing price of the stock of $16.32 on October 01. The lowest price set for the stock is $23 — just above 40.93 percent from GEO share price now.

The stock is lingering around the initial support level of $15.91. After this, the following support is at the zone of $15.49. Up until the time the GEO stock hit levels beyond the current one, bulls should have no alarm. In terms of its momentum, the stock’s RSI hit 33.99 on the daily chart, and this may be a cause for comfort. In case the price goes below $15.49 level on closing basis, there may be more profit booking with the stock growing weaker. Still, getting to the $17.15 level may cause a pull-back move approaching $17.97 mark.

On October 01, 2019, The GEO Group, Inc. (NYSE:GEO) shares lost -5.88% or -1.02 points to close at $16.32 with a thin trading volume of 1.836 million shares. It opened the trading session at $17.39, the shares rose to $17.56 and dropped to $16.32, the range by which the price of stock traded the whole day. The company now has a market cap of $2.01 billion and currently has 123.37 million outstanding shares. The GEO Group, Inc. (GEO) stock has plunged -4.9 percent of market value in 21 trading days.

GEO stock’s trailing 3-year beta is 1.13, meaning there will be a greater rate of return, although posing a higher risk. The part of a firm’s profit given to each outstanding share of regular stock was $1.3 share in the trailing 52 weeks. The stock’s value fallen -17.16 percent year to date (YTD) compared to a decline of -35.14 percent in 52 week’s period. The firm’s shares are still trading -35.29 percent below its 1-year high of $25.22 and -0.06 percent down from 52-week low of $16.33. The average consensus ranking on the company is 3, on a ranging where 5 is equal to a consensus sell rating. In other words, the mean analyst recommendations are ranking this stock as a hold.

The GEO Group, Inc. (GEO) shares are trading at a P/E ratio of 13.4 times earnings posted in the trailing 12 months. The industry GEO deals with has an average P/E of 32.7. Its P/B ratio is standing at 2.1X compared to the 2.3 industry average. It is additionally sporting a 0.9 on the Price-to-Sales ratio, compared to the industry’s P/S average of 7.1. The GEO Group, Inc. has a 25.2% gross profit margin, with its operating margin around 11.8%. Alongside this, the company’s net profit margin currently stands at 6.5%.

Past records have indicated that shares in The GEO Group, Inc. rose on 22 different earnings reaction days and we have yet to see whether this trend will play out and remain in place when the company reports upcoming earnings.