The GEO Group (NYSE: GEO) and Corecivic (NYSE:CXW) are both mid-cap finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, risk, analyst recommendations, profitability, valuation and dividends.
The GEO Group pays an annual dividend of $1.88 per share and has a dividend yield of 8.5%. Corecivic pays an annual dividend of $1.68 per share and has a dividend yield of 7.5%. The GEO Group pays out 139.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Corecivic pays out 100.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. The GEO Group has raised its dividend for 5 consecutive years. The GEO Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Earnings & Valuation
This table compares The GEO Group and Corecivic’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|The GEO Group||$2.18 billion||1.26||$148.71 million||$1.35||16.46|
|Corecivic||$1.85 billion||1.43||$219.91 million||$1.67||13.38|
Corecivic has lower revenue, but higher earnings than The GEO Group. Corecivic is trading at a lower price-to-earnings ratio than The GEO Group, indicating that it is currently the more affordable of the two stocks.
This table compares The GEO Group and Corecivic’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|The GEO Group||7.05%||14.85%||4.17%|
Volatility & Risk
The GEO Group has a beta of 1.52, suggesting that its stock price is 52% more volatile than the S&P 500. Comparatively, Corecivic has a beta of 0.89, suggesting that its stock price is 11% less volatile than the S&P 500.
Institutional & Insider Ownership
95.6% of The GEO Group shares are owned by institutional investors. Comparatively, 83.2% of Corecivic shares are owned by institutional investors. 2.4% of The GEO Group shares are owned by insiders. Comparatively, 1.3% of Corecivic shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
This is a summary of recent recommendations and price targets for The GEO Group and Corecivic, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|The GEO Group||0||1||2||0||2.67|
The GEO Group currently has a consensus price target of $33.78, suggesting a potential upside of 52.01%. Corecivic has a consensus price target of $36.00, suggesting a potential upside of 61.15%. Given Corecivic’s stronger consensus rating and higher possible upside, analysts plainly believe Corecivic is more favorable than The GEO Group.
Corecivic beats The GEO Group on 9 of the 17 factors compared between the two stocks.
The GEO Group Company Profile
The GEO Group, Inc. is a real estate investment trust (REIT) specializing in the ownership, leasing and management of correctional, detention and re-entry facilities and the provision of community-based services and youth services in the United States, Australia, South Africa, the United Kingdom and Canada. As of December 31, 2013, its worldwide operations included the management and/or ownership of approximately 77,000 beds at 98 correctional, detention and community based facilities, including idle faclities and projects under development, and also included the provision of monitoring of more than 70,000 offenders in a community-based environment on behalf of approximately 900 federal, state and local correctional agencies located in all 50 states. The Company operates in four segments: United States Corrections and Detention segment, segment; International Services segment and Facility Construction and Design segment.
Corecivic Company Profile
CoreCivic, Inc., formerly Corrections Corporation of America, is a diversified government solutions company. The Company provides partnership correctional, detention and residential reentry facilities and operates prison in the United States. The Company’s business offerings include CoreCivic Safety, CoreCivic Properties, and CoreCivic Community. The Company provides a range of solutions to government partners that serve the public good corrections and detention management, government real estate solutions, and network of residential reentry centers. As of March 31, 2017, the Company owned or controlled 48 correctional and detention facilities, owned or controlled 27 residential reentry centers, and managed an additional 11 correctional and detention facilities owned by its government partners, with a total design capacity of approximately 88,400 beds in 20 states.
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