Why Michael Burry Continues To Own $GEO Group
GEO still is Burry's largest stock position
Back in November we wrote up a detailed analysis on why Michael Burry loaded up on prison stocks.
The thesis with prison stocks is so compelling we decided to build a financial model of both GEO Group (GEO) and CoreCivic (CXW) and have continued to follow the two names closely.
Two days ago, GEO Group reported earnings. The stock price proceeded to crash 20% as guidance for 2023 was a bit weaker than what analysts expected.
We think the stock reaction was completely unwarranted and continue to believe the company remains extremely undervalued with a key catalyst in May that will drive revenues and EBITDA.
In fact, the stock remains so compelling that legendary investor Michael Burry still has GEO has his single largest public holding.
We like the stock. The valuation remains in ultracheap territory. There is a major catalyst coming in just a few months. Uneducated investors have sold the name off. And the company could have their best year ever, despite management’s nonaggressive guidance.
Here’s why we love the stock at these valuation levels. And why Michael Burry continues to hold the name.
(PSA: This will be the last post to get locked into our lower grandfathered pricing. On Tuesday 2/20, we will be increasing our pricing)
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