PZN has announced new contracts on 5,377 beds this year, 1,225 are existing facilities. This represents an 18% increase(5,377/30k) in ALL the beds PZN owns since CCA and PZN started buying beds. And this is just the first quarter. These new beds are estimated to cost $155MM.
It's been my understanding this is the pace management had expected, $600MM in new business this year alone. By my rough calculations using 9% debt this will add $.50/share of new earnings to the firm, or in excess of a 20% growth rate.
$600MM in new beds will add appx. 50-60% more beds then what is finished on the books now. Assuming the market value is 30-40% higher of a new bed once it's on-line, these new beds should increase the actual book value of the firm by 25%.
Just thought you'd like to know why the share price is going down.