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The GEO Group, Inc. Message Board

  • sf_rich sf_rich Mar 6, 2000 9:48 PM Flag

    Why is this share price so friggin low?

    I don't know much about Wackenhut or
    WCorrections, but could someone fill me in as to why this stock
    is priced so low?? This was one of 4 stocks that
    were returned when I used a very restrictive screen
    for financial health, and I came to like it more as I
    looked at its numbers. I bought a few hundred shares
    just based on the numbers (not always a smart thing to
    do!), but I just couldn't see how a business with such
    high earnings predicatbility and such a healthy
    balance sheet could help but move significantly upward.
    Is there something here I am not seeing????? Many
    thanks in advance to anyone who might help me find an

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    • Investing in this company is indicative of a
      hellacious lack of humanity. It also looks like you'll lose
      your ass.
      From todays NYTimes:
      T he Justice
      Department filed a lawsuit yesterday against the Wackenhut
      Corrections Corporation and the State of Louisiana charging
      that conditions at a private for-profit juvenile
      prison in central Louisiana
      run by Wackenhut are
      "dangerous and life threatening" and asking a federal judge
      take emergency action to protect the inmates.

      The lawsuit asked Judge Frank J. Polozola of
      Federal District Court in Baton Rouge to intervene to
      stop guards at the Wackenhut prison from beating the
      young boys, throwing gas grenades into their
      barracks,holding them for long periods in isolation and failing to
      provide the inmates with adequate mental health care and

      David Utter, director of the Juvenile
      Justice Project of Louisiana, a civil rights and advocacy
      group that represents some of the inmates, said the
      Justice Department action was highly unusual because it
      was done in the form of a request for a preliminary
      injunction for emergency relief, rather than as a regular
      "It is an extraordinary remedy for a
      horrendous situation," Mr. Utter said.
      A group of
      experts hired by the Justice Department who toured the
      prison, at Jena, reported that many of the 276 boys
      incarcerated there had no shoes or blankets and were
      constantly short of food. The experts also
      reported that
      many boys had tried to commit suicide or had
      deliberately injured themselves to get into the infirmary as a
      way to escape physical abuse by the guards.

      A New Orleans juvenile court judge, Mark Doherty,
      found conditions at Jena so bad he released six boys he
      had sent there after visiting the prison earlier this
      month. Judge Doherty, a Republican and former
      prosecutor, said Wackenhut had treated the boys no better
      than animals "on all fours."

      In response to
      the Justice Department lawsuit, Wackenhut released a
      written statement saying that the company "is providing a
      constitutionally sound, safe and secure facility" and that it is
      "working hard to continuously improve the operations
      through additional support from our corporate and
      regional staff."

      In addition, Wackenhut said it
      believed the Justice Department experts had been misled by
      "exaggerations and misstatements of facts" by inmates they had
      interviewed, and that the experts' findings "do not accurately
      reflect the condition of the facility today."

      Richard Stalder, the secretary of the Louisiana
      Department of Public Safety and Corrections was said to be
      out of town and other officials in his office did not
      return calls seeking comment.

      Wackenhut, based
      in Palm Beach Gardens, Fla., is the second largest
      private prison company in the United States and the
      largest internationally. It operates 39,308 beds in 56
      institutions in 13 states and 7 foreign countries, and its
      shares trade on the New York Stock Exchange.

      Justice Department officials have privately expressed
      both bafflement and anger at the conditions in Jena,
      since the Justice Department had reached an agreement
      with Wackenhut just before the prison opened
      December 1998 laying down guidelines for how the prison
      would be run.

      Bill Lann Lee, acting assistant
      attorney general for civil rights, said "We are taking
      this action on behalf of young people in this facility
      who cannot help or protect
      themselves." Mr. Lee
      added, "It is clear that, at this time, we need to
      involve the court to get some emergency relief."

    • I am long on this stock but watching it's slow
      slow crawl back up is so painful. I'm at least
      consoled by the fact it is such a good stock. Good
      earnings/revenue/growth. If I had this much invested in AMZN I don't think
      I good sleep as well.

      Does anyone here have
      any thoughts on if the presidential election is a
      factor on this stock? Are investors holding back to see
      if Gore/Bush make any changes in policy?

      Hang on....

    • Though I agree with your post, I too have held
      this since before the $45 split. I have continued to
      average down, but at times you need to withdraw the
      emotion, and realize I can make more in a money market.
      Who knows, you may have gotten in at the right time,
      but for people who have owned this for 4-5 years,
      it's like watching an alzheimers patient die a slow
      death; you just wait for the day when it's

      I have sold have of my postion for some losses, and
      pray I can just get even on the rest. If I didn't hold
      a shimmer of hope that this will someday be
      recognized by the street, and the price will rise, I would
      have sold it all. Manboking is the most optimistic,
      and long term, but I believ he would echo my

      Easily Confused

    • <EOM>

    • Thanks for the info. Sounds like you do your homework well. When I get a few minutes I'll try some of the sites and tips you shared with everybody.

      Thanks again!

    • Hi PBC!

      My two favorite free stock
      screeners are those provided by Kiplinger and Quicken. I'll
      give the websites at the end of this

      Occasionally, I like to check on certain kinds of extreme
      stocks. On the day that I discovered WHC, I decided that
      I would research stocks which had ZERO long-term
      debt (a special and rather rare condition!), as well
      as very strong, consistent earnings growth. Using
      the Kiplinger screener, I set the following
      parameters: Earnings Growth Past 5 Yrs: greater than 40%;
      Projected 3-5 yr Earnings Growth: greater than 20%; Long
      Term Debt to Equity equal to ZERO!; a PEG ratio of
      less than 0.75. And I believe only three stocks in the
      vast world of available issues met these very unusual
      criteria!! Of course, one must always be wary of future
      earnings projections! One must carefully examine past
      earnings to see if they are quite stable! Also, perhaps
      you are familiar with the widely used "PEG Ratio":
      Price to Earnings to Growth. Most analysts will
      generate a PEG based on several past quarters of earnings
      and the present share price. A PEG ratio of under 1
      suggests (if other conditions are met) that the stock is
      undervalued. But be forewarned!! The Kiplinger screen uses a
      "forward-looking PEG" that is not based on PAST earnings, but on
      FUTURE estimates!! Even so, if earnings are fairly
      stable, this kind of PEG can be useful. WHC's
      forward-looking PEG of about 0.6 suggests that it is
      significantly undervalued, especially in light of its
      incredibly healthy, no-debt balance sheet!! I did a bit more
      research on WHC, but really less than I'd like to -- the
      numbers were so unusually good that I decided to pick up
      a moderately-sized bushel-o-shares!
      Hope you
      find this helpful! Here are the relevant links:
      Kiplinger's Nifty Stock Screener (scroll down the page to see
      Quicken's Equally Nifty Screener: Once you've screened you stocks, be sure to check
      them out at Marketguide, and OUTSTANDING free research
      site!! Compare them with other stocks in their industry
      and sector, as well as the S&P 500: If you investigate this excellent site thoroughly
      (and work thru its handy tutorials!) you will be well
      rewarded for your efforts!!

    • Did anyone have confirmation of the article that
      projected 25% per annum growth in the private corrections
      industry? Despite our exceptional growth I would like to
      see some more evidence regarding the overall trend.

    • Did anyone check out crdt? That stock took a
      serious hit the other day, but it has explosive growth
      and is highly profitable. Any suggestions on where to
      find info. the message board there is filled with
      shorts so its difficult to get a rational picture. As
      for WHC, $18 is a very reasonable projection, I would
      expect longterm growth that won't stop there. Obviously,
      anything outside of tech, is currently fighting the
      market. Banks in Canada though have already put strict
      standards on margins invested in techs. Other lending
      institutions may not be far behind in trying to protect
      themselves and their investors from this vulnerable
      position. This pressure bodes well for sound value based
      investment, if not for the market.

    • It's very easy to sell too soon.

    • I saw your earlier post where you mentioned you
      use a tight search. Your latest post got me thinking
      about it again. It sounds as though it's good for
      bargin hunting.

      Could you share your search
      parameters with us? I am always interested in hearing about
      a better mousetrap that someone has


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