Donald Trump's presidency has been a boon for a private prison company that backed his campaign.
Shares of the GEO Group (GEO) soared during the opening days of the Trump White House, rallying more than 27% since Inauguration Day. Investors in the Boca Raton, Florida-based private prison company are apparently bullish on the administration's promise to up immigration enforcement and the Department of Justice's tough-on-crime stance under Attorney General Jeff Sessions.
The GEO Group is the top-performing stock in TheStreet's Donald Trump Stock Portfolio, a set of 15 stocks identified by TheStreet that are poised to benefit from the president's policies. Bitcoin Investment Trust (GBTC) climbed 17%, and shares of Boeing (BA) , Oracle (ORCL) and Elbit Systems (ESLT) made gains of more than 10% as well. The Trump portfolio has outperformed the benchmark Standard & Poor's 500 Index by about a half of a percentage point since he became president.
Private prison stocks have been some of the top performers since Trump's election -- shares of GEO are up more than 100% since Election Day on November 8, and shares of Corecivic (CXW) have climbed nearly 140%.
The Obama administration in 2016 sought to curb the federal government's use of private prisons. The DOJ sent a memo in August directing the Bureau of Prisons to decline to renew or scale back its contracts with such facilities, and Democratic candidate Hillary Clinton was widely expected to continue such policies. She called for an end to the use of private prisons on the campaign trail.
With Trump's victory, however, the tides have turned. The DOJ in February reversed the Obama administration's August order, and the department under Sessions is poised to up immigration enforcement and take a tougher stance on crime. The administration in April awarded a $110 million contract to GEO for a new immigrant detention center to be built in Texas.