NEW YORK (TheStreet) -- Shares of GEO (GEO - Get Report) were slumping 5.2% to $20.77 in mid-afternoon trading on Monday as the Department of Homeland Security is reviewing the use of private prison companies.
The agency's secretary Jeh Johnson said today that he directed his advisory council to evaluate whether the department should continue to contract with private prisons.
The department's division of Immigration and Customs Enforcement presently uses private prison companies such as Corrections Corp. of America (CXW) to operate some of its detention facilities for immigrants, Reuters noted.
The move comes after the Justice Department's decision earlier this month to reduce and ultimately end its contracts with private prisons.
GEO is a Boca Raton, FL-based real estate investment trust that specializes in the ownership and management of correctional, detention and re-entry facilities.
Shares of Corrections Corp. were falling 7.88% to $16.13 in midday trading today.
Separately, TheStreet Ratings Team has a "Hold" rating with a score of C+ on GEO stock.
The primary factors that have impacted the rating are mixed. The company's strengths can be seen in multiple areas, such as its robust revenue growth, notable return on equity and reasonable valuation levels.
But the team also finds weaknesses including feeble growth in the company's earnings per share, unimpressive growth in net income and poor profit margins.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
You can view the full analysis from the report here: GEO