Geo Group Cuts The Dividend: What Now?

Apr. 08, 2021 8:00 AM ETThe GEO Group, Inc. (GEO) StockCXW, GEO241 Comments

Summary

  • GEO finally eliminated its dividend - sending the stock down 20%.
  • Even after the crash, the stock still is not cheap when you dig deep into the numbers.
  • I estimate that 49% of revenues are attributable to entities that are likely to significantly pare back their exposure with GEO.
  • I reiterate my sell rating.
  • Looking for a helping hand in the market? Members of Best Of Breed get exclusive ideas and guidance to navigate any climate. Learn More »

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On April 7th, Geo Group (NYSE:GEO) announced that it was cutting its dividend. The stock subsequently fell 20%, perhaps due to yield investors fleeing a yield-less equity. In spite of the stock price correction, the future

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This article was written by

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Julian Lin is a financial analyst. He finds undervalued companies with secular growth that appreciate over time. His approach is to look for companies with strong balance sheets and management teams in sectors with long growth runways.

Julian is the leader of the investing group Best Of Breed Growth Stocks where he only shares positions in stocks which have a large probability of delivering large alpha relative to the S&P 500. He also combines growth-oriented principles with strict valuation hurdles to add an additional layer to the conventional margin of safety. Features include: exclusive access to Julian's highest conviction picks, full stock research reports, real-time trade alerts, macro market analysis, individual industry reports, a filtered watchlist, and community chat with access to Julian 24/7. Learn more.

Analyst’s Disclosure:I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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