The GEO Group Inc

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GEO : NYSE : Financial
$34.09 up 0.40 | 1.20%
Today's Range: 33.53 - 34.13
Avg. Daily Volume: 443,900
07/28/16 - 3:37 PM ET

Financial Analysis


GEO GROUP INC's gross profit margin for the first quarter of its fiscal year 2016 has decreased when compared to the same period a year ago. Sales and net income have grown, and although the growth in revenues has outpaced the average competitor within the industry, the net income growth has not. GEO GROUP INC has strong liquidity. Currently, the Quick Ratio is 1.50 which shows the ability to cover short-term cash needs. The company's liquidity has increased from the same period last year.

During the same period, stockholders' equity ("net worth") has remained virtually unchanged only decreasing by 3.36% from the same quarter last year. The key liquidity measurements indicate that the company is unlikely to face financial difficulties in the near future.

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Income Statement Q1 FY16 Q1 FY15
Net Sales ($mil)510.19427.37
EBITDA ($mil)89.5679.81
EBIT ($mil)61.1154.87
Net Income ($mil)32.3528.78


Balance Sheet Q1 FY16 Q1 FY15
Cash & Equiv. ($mil)71.5377.47
Total Assets ($mil)3543.033367.92
Total Debt ($mil)2203.491979.55
Equity ($mil)991.651026.15


Profitability Q1 FY16 Q1 FY15
Gross Profit Margin24.2325.61
EBITDA Margin17.5518.67
Operating Margin11.9812.84
Sales Turnover0.540.51
Return on Assets4.034.29
Return on Equity14.4214.1
Debt Q1 FY16 Q1 FY15
Current Ratio1.621.52
Debt/Capital0.690.66
Interest Expense29.3724.65
Interest Coverage2.082.23


Share Data Q1 FY16 Q1 FY15
Shares outstanding (mil)74.9574.62
Div / share0.650.62
EPS0.440.39
Book value / share13.2313.75
Institutional Own % n/a n/a
Avg Daily Volume454255.0529088.0

Valuation


BUY. The current P/E ratio indicates a significant discount compared to an average of 50.71 for the Real Estate Investment Trusts (REITs) industry and a discount compared to the S&P 500 average of 25.05. To use another comparison, its price-to-book ratio of 2.60 indicates valuation on par with the S&P 500 average of 2.81 and a discount versus the industry average of 4.07. The price-to-sales ratio is well below both the S&P 500 average and the industry average, indicating a discount. Upon assessment of these and other key valuation criteria, GEO GROUP INC proves to trade at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
GEO 17.85 Peers 50.71   GEO 40.23 Peers 24.22

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

GEO is trading at a significant discount to its peers.

 

Premium. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

GEO is trading at a significant premium to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
GEO 16.03 Peers 55.43   GEO 3.36 Peers 4.98

Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations.

GEO is trading at a significant discount to its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

GEO trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
GEO 2.60 Peers 4.07   GEO -3.02 Peers 63.97

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

GEO is trading at a significant discount to its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, GEO is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
GEO 1.34 Peers 8.76   GEO 11.60 Peers 47.28

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

GEO is trading at a significant discount to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

GEO significantly trails its peers on the basis of sales growth

 

 

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