GEO - Why The GEO Group Stock Plunged 19.5% in the First Half of 2021
Shares of The GEO Group (NYSE: GEO) fell a painful 19.5% in the first six months of 2021 according to data from S&P Global Market Intelligence . And while the decline was just a continuation of a downtrend trend that started way back in 2017, there were some pretty big developments in the first half of this year that were very material negatives for real estate investment trust (REIT) and dividend-focused investors who own this prison operator.
Since REITs are designed to be dividend-generating assets, it shouldn't be too surprising that GEO's dividend cut at the end of 2020 was disappointing to investors. But to be followed up with a first-quarter cut in 2021 was clearly even worse. The pain didn't end there, however, as the REIT followed up that second consecutive quarterly cut by eliminating its dividend when it reported first-quarter financial results in early May. Investors often sell shares in the face of dividend cuts.
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Why The GEO Group Stock Plunged 19.5% in the First Half of 2021