We have all made money in CXW. Let's think about expected returns going forward. I expect 21% from here within 12 months.
Anyone who owns CXW at these levels and understands the industry dynamics should also own Cornell (CRN). GEO (GGI) has strong management but it is impossible to tell what the company will look like in the next 1-3 years.
CRN is cheap on a relative basis using price/book, price/earnings, and EV/EBITDA metrics. Current projects will increase EBITDA by almost 30% over the next 18 months.
The stock will get to $18 dollars over that period whether through execution or an acquisition.
On the acquisition front, the GEO Group is the perfect buyer, they failed to acquire a UK based company with a $360MM cash offer and are looking for a domestic or international acquistion that will increase their exposure to the adult secure business.
<"We have all made money in CXW."> Not all of us. At least we are moving in the right direction. I expect to remain with CAA in order to "get back to even" rather than diversify within this industry. Hang in long timers, we're getting there!