Earnings results often indicate what direction a company will take in the months ahead. With Q4 behind us, let’s have a look at GEO Group (NYSE:GEO) and its peers.
Rising concerns over physical security, cybersecurity threats, and workplace safety regulations will present opportunities for companies in this sector. AI and digitization will enhance surveillance, access control, and threat detection, which could benefit key players in Safety & Security Services. These trends could also introduce ethical and regulatory concerns over data privacy and automated decision-making in security operations, giving rise to headline risks. Finally, increasing scrutiny on private security practices and evolving criminal justice policies again mean that companies in the space need to operate with the utmost care or risk being the poster child of abuse of power.
The 5 safety & security services stocks we track reported a slower Q4. As a group, revenues were in line with analysts’ consensus estimates while next quarter’s revenue guidance was 1% above.
In light of this news, share prices of the companies have held steady. On average, they are relatively unchanged since the latest earnings results.
Slowest Q4: GEO Group (NYSE:GEO)
With a global footprint spanning three continents and approximately 81,000 beds across 100 facilities, GEO Group (NYSE:GEO) operates secure facilities, processing centers, and reentry services for government agencies in the United States, Australia, and South Africa.
GEO Group reported revenues of $607.7 million, flat year on year. This print exceeded analysts’ expectations by 0.6%. Despite the top-line beat, it was still a softer quarter for the company with a significant miss of analysts’ EPS estimates.
George C. Zoley, Executive Chairman of GEO, said, “During the fourth quarter of 2024, we completed the previously announced reorganization of our senior management team and incurred additional professional fees in anticipation of what we expect to be unprecedented future growth opportunities and significant operational activity during 2025. In 2024, we also incurred $9 million of our previously announced $70 million investment to strengthen our capabilities to deliver expanded detention capacity, secure transportation, and electronic monitoring services to U.S. Immigration and Customs Enforcement (“ICE”) and the federal government.
The stock is up 11.3% since reporting and currently trades at $28.67.
Originally founded in 1983 as the first private prison company in the United States, CoreCivic (NYSE:CXW) operates correctional facilities, detention centers, and residential reentry programs for government agencies across the United States.
CoreCivic reported revenues of $479.3 million, down 2.4% year on year, outperforming analysts’ expectations by 2.8%. The business had a strong quarter with an impressive beat of analysts’ EPS estimates.
CoreCivic pulled off the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 16.4% since reporting. It currently trades at $21.94.
Founded in 1914 as Mine Safety Appliances to protect coal miners from dangerous gases, MSA Safety (NYSE:MSA) designs and manufactures advanced safety products that protect workers and facilities across industries including fire service, energy, construction, and manufacturing.
MSA Safety reported revenues of $499.7 million, flat year on year, falling short of analysts’ expectations by 3.7%. It was a softer quarter as it posted EPS in line with analysts’ estimates.
MSA Safety delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 11.2% since the results and currently trades at $144.65.
Founded in 1914 and evolving through more than a century of industrial innovation, Brady (NYSE:BRC) manufactures and supplies identification solutions and workplace safety products that help companies identify and protect their premises, products, and people.
Brady reported revenues of $356.7 million, up 10.6% year on year. This result came in 0.7% below analysts' expectations. Overall, it was a softer quarter as it also produced a miss of analysts’ EPS estimates.
Brady pulled off the fastest revenue growth among its peers. The stock is down 8.9% since reporting and currently trades at $68.04.
Known for its iconic armored trucks that have been a fixture in American cities since 1859, Brink's (NYSE:BCO) provides secure transportation and management of cash and valuables for banks, retailers, and other businesses worldwide.
Brink's reported revenues of $1.26 billion, up 1.4% year on year. This print beat analysts’ expectations by 0.9%. Zooming out, it was a satisfactory quarter as it also logged a solid beat of analysts’ EPS estimates.
The stock is down 10% since reporting and currently trades at $85.01.
The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.
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