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Geo Group (GEO) Outpaces Stock Market Gains: What You Should Know

·3 min read

In the latest trading session, Geo Group (GEO) closed at $8.43, marking a +1.69% move from the previous day. This change outpaced the S&P 500's 1.53% gain on the day. At the same time, the Dow added 1.19%, and the tech-heavy Nasdaq gained 0.14%.

Prior to today's trading, shares of the private prison operator had gained 23% over the past month. This has outpaced the Finance sector's loss of 1.54% and the S&P 500's loss of 3.1% in that time.

Geo Group will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $0.56, down 13.85% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $605.85 million, up 8.72% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $2.44 per share and revenue of $2.35 billion. These totals would mark changes of -1.61% and +4.1%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for Geo Group. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Geo Group is holding a Zacks Rank of #2 (Buy) right now.

Looking at its valuation, Geo Group is holding a Forward P/E ratio of 3.4. For comparison, its industry has an average Forward P/E of 12.89, which means Geo Group is trading at a discount to the group.

It is also worth noting that GEO currently has a PEG ratio of 0.34. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The REIT and Equity Trust - Other industry currently had an average PEG ratio of 2.27 as of yesterday's close.

The REIT and Equity Trust - Other industry is part of the Finance sector. This industry currently has a Zacks Industry Rank of 84, which puts it in the top 34% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow GEO in the coming trading sessions, be sure to utilize Zacks.com.

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