GEO Group's Stock Soars After BOP Contract Renewal
GEO Group Inc.'s stock soared 10% in active premarket trade Friday, bouncing after the plunge in the prior session, after the company said the Federal Bureau of Prisons (BOP) renewed a contract for the D. Ray James Correctional Facility. The renewal term for the company-owned Georgia facility is through Sept. 30, 2018 under its existing 10-year contract, which is effective through Sept. 30, 2022. "We believe that this contract renewal is indicative of the BOP's continued focus on quality as it evaluates its current privately-operated facilities," said Chief Executive George Zoley. GEO's stock had plummeted 40% on Thursday, the biggest one-day drop since it went public in July 1994, after the Justice Department announced a decision to phase out the use of for-profit prison facilities. The stock had lost 33% year to date through Thursday, while the S&P 500 had gained 7%. Shares of fellow prison operator Corrections Corporation of America climbed 12% ahead of the open.
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