GEO - The GEO Group Inc. (GEO) - A 10-Q Review

10-Q Overview. We were able to perform a deep dive into The GEO Group's 10-Q over the weekend. And while nothing in the 10-Q changes our assessment of GEO and its business prospects, the 10-Q does provide some enhanced details we want to share.ICE — 1. While the following are from news reports and we have not confirmed, it is being reported July border encounters topped 210,000, up from 188,000 in June. If accurate, this would be the highest monthly total in over 20 years. Significantly, summer months tend to see a drop off in encounters as weather conditions worsen. Since this is not the case suggests numbers for August and September could continue to rise. We remain on pace to break the all-time border encounter record set in 2000. ICE — 2. There also are reports that people from around the globe are crossing the southwest border in record numbers, unlike previous years when it was mostly Central Americans. And Title 42 enforcement may be waning, with reports that single adults are not being turned back once across the border. If these news reports are accurate in terms of numbers of encounters and waning enforcement of Title 42, this could increase demand for the facilities operated by GEO. Favorable Risk/Reward. We continue to believe GEO shares represent a favorable risk/reward situation. Although the meme stock crowd continues to impart unusual volatility in GEO shares, we are maintaining our Outperform rating and a $15 per share 12-month price target. While COVID and the political rhetoric remain headwinds, there remain limited alternatives to GEO's services and we believe the Company's real estate assets and high quality contracts eventually will be properly valued. Read More >>