GEO Missed Q1 Targets On Rising Costs And Debt, Guides Q2 Below Street Estimates

Written by Emily J. Thompson, Senior Investment Analyst

GEO+1.81%

BOUT+0.06%

MGMT+2.42%

Source: Benzinga

Updated: May 07 2025

0mins

Source: Benzinga

Financial Performance: GEO Group, Inc. reported first-quarter revenue of $604.6 million, missing expectations, with adjusted EBITDA declining to $99.8 million and adjusted EPS at 14 cents, below the consensus of 18 cents. The company also announced a raised FY25 outlook for EPS and revenue, despite higher operating expenses expected in the first half of the year.
Future Growth Plans: The company has secured contracts for reactivating facilities that will generate over $130 million in annualized revenues and plans to invest $70 million to enhance its operational capabilities. Additionally, GEO aims to reduce net debt by $150 million to $175 million in 2025 while projecting capital expenditures of $120 million-$135 million.

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GEO

$16.34+Infinity%1D

Analyst Views on GEO

Wall Street analysts forecast GEO stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for GEO is 34.00 USD with a low forecast of 30.00 USD and a high forecast of 37.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.

3 Analyst Rating

3 Buy

0 Hold

0 Sell

Strong Buy

Current: 16.050

Low

30.00

Averages

34.00

High

37.00

Current: 16.050

Low

30.00

Averages

34.00

High

37.00

JonesResearch

Buy

downgrade

$50 -> $37

2025-11-07

Reason

JonesResearch

Price Target

$50 -> $37

AI Analysis

2025-11-07

downgrade

Buy

Reason

JonesResearch lowered the firm's price target on Geo Group to $37 from $50 and keeps a Buy rating on the shares. The pathway toward $3B+ in annualized revenue from upcoming contracts and monitoring has begun tot show for FY26, the analyst tells investors in a research note. The firm revised its estimates downward, however, to account for slower-than-expected growth, but noted that it remains bullish on all segments of GEO, in particular the Intensive Supervision Appearance Program opportunity.

JonesResearch

Jason Weaver

Buy

maintain

$50 -> $45

2025-08-07

Reason

JonesResearch

Jason Weaver

Price Target

$50 -> $45

2025-08-07

maintain

Buy

Reason

JonesResearch analyst Jason Weaver lowered the firm's price target on Geo Group to $45 from $50 and keeps a Buy rating on the shares following the Q2 report the Q2 beat. The firm cites alternatives to detention growth for the target cut. Geo's Intensive Supervision Appearance Program commentary disappointed, the analyst tells investors in a research note.

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About GEO

The GEO Group, Inc. is a diversified government service provider. The Company specializes in design, financing, development, and support services for secure facilities, processing centers, and community reentry centers in the United States, Australia, South Africa, and the United Kingdom. The Company’s U.S. Secure Services segment primarily encompasses the United Sates-based secure services business. Its Electronic Monitoring and Supervision Services segment represents technology and services provided to adults for monitoring services for community-based parolees, probationers, and pretrial defendants. Its Reentry Services segment represents evidence-based supervision and treatment programs provided to adults for residential and non-residential treatment, educational and community-based programs, pre-release and half-way house programs. Its International Services segment primarily consists of secure services operations in South Africa and Australia.

About the author

Emily J. Thompson

Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.