Geo Group (GEO) AI Stock Analysis

• Market Cap: $3.07B
• Dividend Yield: N/A
• Average Volume (3M): 3.42M
• Price to Earnings (P/E): 34.0
• Beta (1Y): 1.40
• Revenue Growth: 1.14%
• EPS Growth: 169.19%
• Country: US
• Employees: 16,500
• Sector: Industrials
• Sector Strength: 83
• Industry: Security & Protection Services
• EPS (TTM): 0.22
• Shares Outstanding: 141,534,620
• 10 Day Avg. Volume: 4,759,284
• 30 Day Avg. Volume: 3,422,197
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.72
• Enterprise Value/Revenue: 2.16
• Enterprise Value/Gross Profit: 2.16
• Enterprise Value/Ebitda: 12.59
• 1Y Price Target: $37.60
• Price Target Upside: 77.69% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5

• Rating: 60 Neutral
• Price Target: $22.00 ▲(3.97% Upside)

Geo Group's overall stock score is driven by a stable financial position and positive earnings call sentiment. However, technical analysis indicates bearish trends, and valuation metrics suggest the stock may be overvalued. Corporate events provide a mixed impact, with positive strategic moves offset by legal challenges.

Geo Group Business Overview & Revenue Model

Company Description

Geo Group (GEO) is a leading provider of correctional, detention, and community reentry services in the United States and internationally. The company operates a diverse portfolio of facilities including prisons, jails, and residential reentry centers, catering to federal, state, and local government clients. GEO also offers rehabilitation and educational programs aimed at reducing recidivism and enhancing public safety, positioning itself as a comprehensive service provider in the criminal justice sector.

How the Company Makes Money

Geo Group primarily generates revenue through contracts with government agencies to manage and operate correctional facilities and community rehabilitation programs. The company earns income from daily per diem rates paid by federal, state, and local governments for housing inmates. Additionally, GEO has revenue streams from providing services such as electronic monitoring, rehabilitation programs, and other correctional services. Significant partnerships with governmental bodies and law enforcement agencies bolster its earnings, as well as the increasing demand for private management of correctional facilities due to budget constraints faced by public institutions.

Geo Group Financial Statement Overview

Summary

Geo Group demonstrates a solid financial position with improved revenue growth and reduced leverage. However, the low net profit margin and declining return on equity highlight areas for improvement. Cash flow management remains a concern, with negative free cash flow growth in the TTM period.

Income Statement

Geo Group's income statement shows a stable revenue growth trajectory with a TTM revenue growth rate of 1.2%. The gross profit margin has improved significantly in the TTM period, indicating better cost management. However, the net profit margin remains relatively low at 3.7%, suggesting room for improvement in profitability. The EBIT and EBITDA margins are healthy, reflecting operational efficiency.

Balance Sheet

The balance sheet indicates a significant reduction in leverage, with the debt-to-equity ratio decreasing from 3.14 in 2021 to 0.22 in the TTM period. This improvement in financial stability is a positive sign. However, the return on equity has decreased over time, currently at 6.7%, which could be a concern for investors seeking high returns.

Cash Flow

The cash flow statement reveals a decline in free cash flow growth, with a negative growth rate in the TTM period. The operating cash flow to net income ratio is moderate, indicating that the company is generating sufficient cash from operations. However, the free cash flow to net income ratio has decreased, suggesting potential challenges in maintaining cash flow levels.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.45B	2.42B	2.41B	2.38B	2.26B	2.35B
Gross Profit	2.45B	2.42B	668.94M	713.84M	627.57M	578.60M
EBITDA	421.08M	355.44M	482.12M	527.29M	457.46M	385.64M
Net Income	90.48M	31.97M	107.33M	171.81M	77.42M	113.03M
Balance Sheet
Total Assets	3.66B	3.63B	3.70B	3.76B	4.54B	4.46B
Cash, Cash Equivalents and Short-Term Investments	67.86M	76.90M	93.97M	95.07M	506.49M	283.52M
Total Debt	1.78B	1.81B	1.89B	2.08B	3.06B	3.05B
Total Liabilities	2.28B	2.30B	2.41B	2.60B	3.56B	3.55B
Stockholders Equity	1.38B	1.33B	1.29B	1.17B	975.02M	912.08M
Cash Flow
Free Cash Flow	131.01M	163.54M	211.93M	206.39M	213.24M	332.93M
Operating Cash Flow	238.11M	242.24M	284.93M	296.41M	282.63M	441.73M
Investing Cash Flow	-146.52M	-101.72M	-60.57M	2.96M	-53.74M	-104.17M
Financing Cash Flow	-93.30M	-168.89M	-208.08M	-699.10M	11.26M	-96.74M

Geo Group Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 21.16
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GEO, the sentiment is Negative. The current price of 21.16 is below the 20-day moving average (MA) of 22.98, below the 50-day MA of 24.04, and below the 200-day MA of 26.92, indicating a bearish trend. The MACD of -1.05 indicates Positive momentum. The RSI at 38.38 is Neutral, neither overbought nor oversold. The STOCH value of 70.49 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GEO.

Geo Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NSSC	79 Outperform	$1.10B	25.08	27.48%	1.71%	-1.05%	-2.78%
ADT	78 Outperform	$7.34B	13.23	17.13%	2.52%	3.80%	-3.18%
REZI	75 Outperform	$4.83B	64.31	-26.27%	―	20.00%	-547.75%
BCO	67 Neutral	$4.61B	29.66	56.23%	0.91%	2.17%	25.34%
ARLO	65 Neutral	$1.75B	―	-6.45%	―	-1.75%	68.19%
GEO	60 Neutral	$3.07B	34.04	6.73%	―	1.14%	169.19%
Sector *	58 Neutral	HK$13.91B	4.82	-3.70%	5.62%	2.15%	-62.33%

Geo Group Corporate Events

Geo Group Faces Legal Setback in Wage Case

On August 13, 2025, The GEO Group, Inc. faced a legal setback when the United States Court of Appeals for the Ninth Circuit denied its petition for a rehearing in cases concerning the enforcement of Washington State minimum wage laws for detainees at the Northwest ICE Processing Center. This decision upholds a previous unfavorable jury verdict from October 2021, which resulted in a $23.2 million judgment against GEO, further increased by $14.4 million in attorney’s fees and costs. The company plans to seek a stay and petition the U.S. Supreme Court, arguing that the decision violates the Supremacy Clause and established legal principles.

GEO Group Announces $300 Million Share Buyback Plan

On August 6, 2025, GEO Group announced a $300 million share repurchase program approved by its Board of Directors on August 4, 2025. This strategic move aims to enhance long-term shareholder value, reflecting the company’s strong financial performance in the second quarter of 2025, where it reported total revenues of $636.2 million and a net income of $29.1 million. Additionally, GEO Group has secured significant contracts with U.S. Immigration and Customs Enforcement (ICE) for its facilities, expected to generate substantial annualized revenues, further solidifying its market position.

Geo Group Expands Credit Facility and Lowers Debt

On July 14, 2025, The GEO Group, Inc. announced an amendment to its Credit Agreement, increasing its revolving credit facility from $310 million to $450 million and extending its maturity to July 14, 2030. The amendment also lowered interest rates and increased the company’s capacity to make restricted payments over the next five years. Prior to this, GEO repaid $132 million of its Term Loan B and plans to use proceeds from the sale of a facility to reduce further debt. These actions are expected to lower GEO’s total net debt to approximately $1.47 billion, positioning the company for potential future capital returns and demonstrating growing support from banking partners.

Geo Group Extends Executive Chairman’s Term and Compensation

On July 7, 2025, Geo Group, Inc. extended the employment term of Executive Chairman George C. Zoley to April 2, 2029, and increased his compensation package, reflecting the company’s strategic focus on leveraging his expertise amidst unprecedented business opportunities. Similarly, adjustments were made to CEO J. David Donahue’s compensation, recognizing his extensive experience as vital to guiding the company through current opportunities in the corrections and detention industry.

Geo Group Sells Lawton Facility to Oklahoma

On June 3, 2025, The GEO Group, Inc. entered into a Purchase and Sale Agreement to sell the Lawton Correctional Facility in Oklahoma to the State of Oklahoma for $312 million. The sale, expected to close on July 25, 2025, will transition facility operations to the Oklahoma Department of Corrections, a current customer of GEO. This transaction is anticipated to significantly reduce GEO’s debt and enhance long-term shareholder value, reflecting the intrinsic value of the company’s owned facilities.