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Verdict
Quantitative factor alignment verified for current market regime.
Quant Score
Rank
#4281
Positioning
Market Dominance
Construction
Construction
$2.9B
Jose Gordo
GEO Group, Inc. owns, leases, and manages secure facilities, processing centers, and reentry centers in the United States, Australia, South Africa, and the United Kingdom. The company operates through four segments: U.S. Secure Services, Electronic Monitoring and Supervision Services, Reentry Services, and International Services. As of December 31, 2021, it owned and managed approximately 86,000 beds at 106 secure and community services facilities.
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X-AXIS: EV/EBITDA (LOWER = CHEAPER) | Y-AXIS: ROE (HIGHER = ELITE) | RED CIRCLE = GEO ANALYSIS TARGET
| Stock | Rating | Score▼ | Quality | Value | Momentum | P/E | EV/EBITDA | ROE | ROA | Gross Mgn | Op Mgn | Net Mgn | Rev Growth | Div Yield | D/E | Mkt Cap | AUDIT |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
$FER Ferrovial SE | 76 | 89 | 94 | 72 | - | - | 162.2% | 12.2% | 87.8% | 88.9% | 38.1% | 0.5% | 2.1% | - | $30.3B | VS | |
$CX CEMEX SAB DE CV | 74 | 81 | 87 | 87 | - | - | 7.8% | 3.5% | 33.6% | 11.2% | 5.9% | -2.1% | 1.1% | 60.0x | $32.6B | VS | |
$MWA Mueller Water Products, Inc. | 69 | 85 | 87 | 57 | 17.9x | 11.0x | 21.4% | 11.0% | 36.1% | 18.2% | 13.4% | 8.8% | 1.1% | 46.0x | $4.0B | VS | |
$TOL Toll Brothers, Inc. | 69 | 83 | 92 | 63 | 7.9x | 5.6x | 16.9% | 9.7% | 25.1% | 15.7% | 12.3% | 1.1% | 0.7% | 34.0x | $13.0B | VS | |
$GFF GRIFFON CORP | 68 | 86 | 82 | 60 | - | - | 34.2% | 2.3% | 42.0% | 8.2% | 2.0% | -4.0% | 0.9% | 1909.0x | $3.5B | VS | |
$FIX COMFORT SYSTEMS USA INC | 68 | 80 | 43 | 97 | 25.0x | 18.1x | 52.7% | 19.4% | 24.8% | 15.5% | 11.9% | 35.2% | 0.2% | 6.0x | $29.1B | VS | |
$BBU Brookfield Business Partners L.P. | 66 | 63 | 94 | 68 | - | - | 5.0% | 1.1% | 14.1% | 7.2% | 2.2% | -26.2% | 1.1% | 1081.0x | $1.7B | VS | |
$PHOE Phoenix Asia Holdings Ltd | 64 | 95 | 97 | 40 | - | - | 42.6% | 22.6% | 29.5% | 17.6% | 13.9% | 28.1% | 0.0% | 0.0x | $6M | VS | |
$EME EMCOR Group, Inc. | 64 | 75 | 42 | 80 | 24.6x | 16.0x | 36.5% | 14.0% | 19.4% | 9.4% | 6.9% | 16.4% | 0.1% | 3.0x | $29.1B | VS | |
$DY DYCOM INDUSTRIES INC | 64 | 68 | 58 | 89 | 19.9x | 9.7x | 29.4% | 11.8% | 22.1% | 10.4% | 7.3% | 14.1% | 0.0% | 63.0x | $8.5B | VS | |
$GEO GEO GROUP INC | 33 | 27 | 61 | 13 | 7.4x | 4.8x | 16.4% | 6.5% | 0.0% | 10.3% | 9.4% | 12.4% | 0.0% | 151.0x | $2.9B | ||
| SECTOR BENCH | - | - | - | - | - | 19.1x | 10.7x | 14.2% | 5.9% | 23.7% | 7.3% | 5.4% | 1.9% | 0.0% | 0.4x | - | REF |
GEO GROUP INC (GEO) receives a "Avoid" rating with a composite score of 33.2/100. It ranks #4281 out of 7,333 stocks in our coverage universe and carries a 1-star rating. Ratings are driven by a 6-factor quantitative model measuring quality, value, momentum, investment, stability, and short interest.
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Lagging peers — losers tend to keep underperforming
Trading at a discount to fundamentals — favorable entry valuation
Weak fundamentals — higher risk of value trap
Average volatility — neutral timing signal
Aggressive spending — empire-building risk, dilutive growth
Below-average composite — caution warranted
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Relative valuation derived from Construction sector benchmarks. Model weights: EV/EBITDA (40%), P/B (35%), P/S (25%). Re-calculated daily.
Projection based on user-defined inputs. Re-calculated daily against current market data.
Reverse DCF Framework — Mauboussin Methodology
Institutional-grade Reverse DCF analysis. This model identifies the growth hurdles embedded in current market prices. When implied growth is significantly lower than historical or projected rates, a margin of safety may exist. Re-audited daily.
No analyst ratings for GEO.
View All Ratings| Factor | Global | Sector | Tilt |
|---|---|---|---|
| PROFITABILITY | 27 | 16 | +11ALPHA |
| MOMENTUM | 13 | 8 | +5NEUTRAL |
| VALUATION | 61 | 74 | -13DRAG |
| INVESTMENT | 34 | 49 | -15DRAG |
| STABILITY | 38 | 35 | +3NEUTRAL |
| SHORT INT | 46 | 42 | +4NEUTRAL |
Global = full universe. Sector = relative to industry peers. Positive tilt indicates idiosyncratic strength.
ROIC 1.4% vs WACC 5.7% (spread -4.3%)
GM 0% vs sector 24%, OM 10% vs sector 7%
Capital turnover 0.47x
Rev growth 12%, 10yr history
Interest coverage 1.1x, Net debt/EBITDA 19.8x
Composite assessment of profitability, capital efficiency, and financial strength. Top-tier entities demonstrate sustainable cash flow generation and elite competitive moats.
Profit generated per dollar of shareholder equity
Efficiency of asset utilization
Pricing power and cost efficiency
Core business profitability
Bottom-line profitability
The Quality factor evaluates the persistence and magnitude of realized cash flows. Companies with scores >70 exhibit superior pricing power and structural financial resilience through diverse economic regimes.
Our uncertainty rating tracks the predictability of future cash flows and potential for permanent capital loss. Moderate visibility with standard industry cyclicality.
We rate GEO GROUP INC (GEO) as Avoid with a composite score of 33.2/100 at a current price of $13.80. The stock falls in the bottom quintile, and the multi-factor weakness suggests a high probability of continued underperformance.
GEO GROUP INC holds a top-quartile position (#0 of 50) within the Construction sector, based on our composite quantitative scoring across quality, value, momentum, and stability factors. The composite score of 33.2/100 places it at rank #4281 in our full universe.
No Moat
High
Poor
Undervalued
Returns on equity of 16.4% exceed cost of capital.
Stable competitive position in a defensive sector.
Leverage of 151% D/E amplifies downside risk.
Weak momentum suggests persistent institutional selling pressure.
Below-average quality raises earnings sustainability concerns.
GEO GROUP INC represents a avoid based on multi-factor quantitative performance.
Our quantitative model flags GEO GROUP INC with an Avoid rating, assigning a composite score of 33.2/100 and 1 out of 5 stars. Ranked #4281 of 7,333 stocks, GEO falls in the bottom tier across key factors. Historically, stocks with this profile have faced elevated risk of underperformance and capital loss.
GEO's quality score of 27/100 is below average, suggesting challenges with profitability or capital efficiency. The company reports a return on equity of 16.4% (sector avg: 14.2%), gross margins of 0.0% (sector avg: 23.7%), net margins of 9.4% (sector avg: 5.4%). Investors should examine whether management is actively addressing these weaknesses or if they reflect structural industry headwinds.
GEO's value score of 61/100 indicates the stock is fairly valued based on its current fundamentals. Key valuation metrics include a P/E ratio of 7.42x, an EV/EBITDA of 4.79x, a P/B ratio of 1.21x. At this level, neither a clear bargain nor overpriced, the stock's attractiveness depends more on forward growth expectations and qualitative factors.
GEO GROUP INC's investment score of 34/100 suggests limited reinvestment activity. Key growth metrics include revenue growth of 12.4% vs. a sector average of 1.9% and a return on assets of 6.5% (sector: 5.9%). While this can be positive for mature, cash-generative businesses returning capital to shareholders, it may also signal a lack of growth opportunities or management conservatism.
GEO GROUP INC is experiencing notably weak momentum with a score of just 13/100. The stock has underperformed its peers and is trending below major moving averages. Revenue growth stands at 12.4% year-over-year, while a beta of 0.93 reflects its sensitivity to broader market moves. While deep momentum weakness can occasionally present value opportunities, it often reflects deteriorating fundamentals or structural headwinds that may persist.
GEO's stability score of 38/100 signals elevated volatility and/or leverage concerns. Key stability metrics include a beta of 0.93 and a debt-to-equity ratio of 151.00x (sector avg: 0.4x). Investors should be prepared for wider-than-average price swings and consider position sizing accordingly to manage portfolio risk.
The short interest score of 46/100 for GEO suggests somewhat elevated bearish positioning by institutional traders. Specific risk factors include elevated leverage (D/E: 151.00x). With a $2.9B market cap (mid-cap), GEO GROUP INC may experience above-average volatility. Investors should consider whether the short thesis has merit or if it creates a potential short-squeeze opportunity.
GEO GROUP INC is a mid-cap company in the Construction sector, ranked #0 of 50 in its sector (100th percentile) and #4281 of 7,333 overall (42nd percentile). Key comparisons include ROE of 16.4% exceeding the 14.2% sector median and operating margins of 10.3% above the 7.3% sector average. This top-quartile standing reflects exceptional competitive strength relative to Construction peers.
While GEO currently exhibits a AVOID profile, superior opportunities exist within the CONSTRUCTION sector. Our model identifies several "Strong Buy" candidates with higher quality scores and more attractive valuations among direct industry competitors.
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Improvement in Momentum (13) would have the largest impact on the composite score.
EV/EBITDA 55% BELOW SECTOR MEDIAN (FAVORABLE)
ROE 16% ABOVE SECTOR MEDIAN (FAVORABLE)
Gross Margin 100% BELOW SECTOR MEDIAN
Above 50MA
37.18%
Net New Highs
+51081
Value stocks typically trade at discounts to the broader market, offering patient investors the opportunity to buy businesses when they’re out of favor. The key risk, however, is that these stocks are usually cheap for a reason – five cents for a piece of fruit may seem like a great deal until you find out it’s rotten.
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In February 2026, The GEO Group, Inc. reported fourth-quarter 2025 results showing higher revenues and net income year-on-year, issued 2026 guidance calling for GAAP diluted EPS of US$0.17–US$0.19 for the first quarter and US$0.99–US$1.07 for the full year on revenues of US$2.90–US$3.10 billion, completed a US$92.45 million share buyback, and announced CEO J. David Donahue will retire at the end of February 2026 with founder Dr. George C. Zoley returning as CEO from March 1, 2026. A key...