What is creating all of the buyer resistance ? I realize REITs are out of favor, but PZN is different than a hotel, shopping center, or other private real estate investments. It's only leasees are taxing bodies.The full faith and credit of the state that signs the lease is our collateral. Right or wrong ? If these
folks can't pay their rent, they raise taxes to pay it. Our prison population doesn't fluxuate that much does it ? Just continues to go up. In the old "CCA" days, investors loved the stock. What has chilled the investors on PZN ?
This thread, if you can access it since the merger, is a compelling case-study, through the eyes of both longs & shorts, a full spectrum of Doc Crants opinions, from cult-like believers to those who view him and his son as the anti-Christ and Satan. In the main, the posts from April 20-the end are cogent, articulate, and honest. And of course, there are those that aren't...mostly from those who are on one or the other extreme, and whose emotions outweighed their common sense. Certainly an exercise worth conducting, if you really want a history lesson on this stock. Without meaning to be 'flip' about your question, no one--whether gifted with 20/20 hindsight or not--can summarize the 9 months of rollercoaster ride those of us who've hung in have been on. It has truly been bizarre.
I have my own theories, as did most who posted on CCA, about why the centers of influence in the market crapped all over the 'merger' from day one, and haven't let up since. No matter whose ideas you find most acceptable, the endgame was simply one gigantic foulup, with a $35 stock and a $40 stock becoming a $20 stock, with shareholders having 87.5% of the shares they started out with. It's sort of like the old TV program 'SOAP.' Remember how it would open, with all the sub-plots being explained...so that by the time the show actually started, you were already laughing? Same here, 'cept you want to cry, not laugh....but the soap opera nature of the last 9 mos. still as unbelievable.
Whether a visionary idea that we'll all have to see played out so we can share in Doc's genius, OR a naked money-grab by the guru of an industry who sold out a lifetime of respect for the bucks, only time will tell. That's the range of opinion. Unfortunately, way too many of the 'centers of influence' saw the latter than the former.
That's my best attempt to answer your question. I think it would be healthy for others who've been here for that period to add to this, shoot it down, or go in a totally different direction.
There is only one bottom line, however. On April 20, 1998, for every 100 shares of CCA you owned, @ or around $35, your CCA asset totalled about $3,500. Today, if you kept it, you have 87.5 shares of PZN, which closed today at about $20, totalling about $1,750.
The government is not the tenant for PZN, except, I beleive, in one small jail acquired in the USCC merger. Private "CCA" is the primary tenant. Not exactly the same. CCA can't really raise taxes to cover its lease payments if government pulls out of management contracts.