Noble Financial Analyst Joe Gomes Reiterates Buy Rating for Geo Group with $35 Price Target.

Noble Financial analyst Joe Gomes maintains a Buy rating for Geo Group with a price target of $35.00. Gomes has a 39.30% success rate and covers the Industrials sector. Geo Group reported Q1 revenue of $604.65 million and a net profit of $19.56 million. Northland Securities's Greg Gibas also maintains a Buy rating for the company, while TR | OpenAI reiterated a Hold rating.

S&P Global Ratings has upgraded The GEO Group Inc. to 'BB-' from 'B+' with a positive outlook, citing improved operating performance and significant debt reduction. The company plans to use $222 million from the sale of its Lawton Facility in Oklahoma and liquidity from its new $450 million revolver to repay senior secured debt. This move is projected to lower the company’s leverage from 3.8x as of March 31 to approximately 2.8x by the end of 2025 [1].

The positive outlook reflects increased demand for GEO’s services due to the current U.S. administration’s aggressive immigration policies. The company has reactivated three previously idle facilities and secured significant government contracts, including a new U.S. Marshals Service contract for secure transportation and detention officer services, expected to generate over $200 million in additional annual revenue. A government bill passed in early July has substantially increased funding for immigration enforcement, further boosting demand for GEO’s services [1].

Financial analysts have mixed views on the stock. Noble Financial analyst Joe Gomes maintains a Buy rating for Geo Group with a price target of $35.00. Gomes has a 39.30% success rate and covers the Industrials sector. Northland Securities' Greg Gibas also maintains a Buy rating, while TR | OpenAI reiterated a Hold rating [2].

Geo Group reported Q1 revenue of $604.65 million and a net profit of $19.56 million. The company has been actively acquiring new facilities, including the 770-bed Western Region Detention Facility in San Diego for $60 million [2].

S&P indicated it could raise GEO’s rating further if the company maintains leverage below 3x with free operating cash flow to debt greater than 10%. Conversely, the outlook could be revised to stable if leverage remains above 3x due to lower-than-expected performance improvements or increased shareholder returns and acquisitions that deteriorate credit metrics [1].

References:
[1] https://www.investing.com/news/stock-market-news/the-geo-group-upgraded-to-bb-by-sp-on-debt-reduction-93CH-4136491
[2] https://finance.yahoo.com/quote/GEO/news/