Prison Stocks to Invest In
Prison stocks are something that don’t get much attention. Especially since most people don’t know they exist. But upon further investigation, it’s clear there’s high potential for ethical profits.
There’s a lot of controversy around the way prisons work. That’s a personal decision. The following companies often receive awards for meeting high standards of quality.
Biden terminated contracts with private prisons. But, they’ve obviously found ways to stay afloat and stay profitable. And, in fact, many of them were more profitable in 2021 than in 2020. Check out the stocks I’ve outlined below.
Prison Stocks to Buy
- CoreCivic (NTSE: CXW)
- Serco (OTC: SCGPY)
- The GEO Group (NYSE: GEO)
- Palantir Technologies Inc. (NYSE: PLTR)
Market Cap: $1 billion
CoreCivic is a prison stock that provides detention operation services. They do this, and have their own prisons and correctional facilities. 77 of them to be exact.
Their motto is to “Better the Public Good”. CoreCivic received one of Newsweek’s 2021 awards. The award is for America’s Most Responsible Companies. This prison stock offers career readiness programs, and opportunities to earn college degrees. Plus, a culinary program in their facilities.
Involvement in the community is a large part of what they do. They urge the prisoners to get involved in activities throughout their stay. Plus, they also stress safety.
Optimizing their real estate properties is also a big part of the company’s activities. Plus, they offer these services to their clients. They work on increasing profitability and sustainability.
Making sure their inmates stay out of prison once they’ve left is important to CoreCivic.
Market Cap: $1.9 billion
This prison stock provides services to governments. They are a company based in England, and do business all around the world.
Managing over 500 contracts around the globe, Serco provides services in five main areas. Those are health, transport, citizen services, justice and immigration, and defense. So, Serco does provide services to prisons. But, they also do a lot of work for general society.
They’ve received several various contracts and contract renewals in 2021.
One of these is an electronic surveillance system for several prisons in the UK and Australia. Another is to provide support for the European Space Agency. And one more is a renewal of a contract where Serco is repainting the tails on UK helicopters.
The half-year earnings report looked very good for 2021 also. Revenue was high. But even more important, profit was high. And free cash flow increased substantially.
The FTSE 250 is like the Fortune 500 of the London Stock Exchange. It’s a little different, though. The FTSE is weighted by market cap. It also contains the 101st to 350th largest companies on the London Stock Exchange. Serco is part of this FTSE 250.
This prison stock is a very old company, too. It was founded in 1988. So, it has a lot of experience behind it.
The GEO Group
Market Cap: $913 million
The GEO Group is a real estate investment company. But, they invest in prisons and mental health properties all over the world. That’s what puts this company on the list of prison stocks. GEO invests in North America, Australia, and other countries.
This prison stock has a commitment to getting their patients and inmates healthy and clean. Then, release them safely back out into the world. They also offer help after the inmates leave.
And they offer a host of services to other facilities. These include electronic monitoring and programs for those in custody. GEO owns 107 properties all over the world, and they have almost 19,000 employees. 69 of those 107 facilities are ACA Accredited. And those 69 facilities have an average score of over 99%.
If you don’t know, ACA stands for American Correctional Agency. The ACA exists to promote standards and healthy re-entry into society. It’s a private organization that’s been around since 1870. It’s the largest association of this type.
GEO focuses on finding methods that are based in evidence. In other words, methods that work and get inmates healthfully back into society.
And often, this is the trouble with private prisons. They are for-profit, so there’s a dilemma when they are being paid for each inmate daily. Why would they want to get them back into society when they are making money for the prisoner to be in prison?
GEO seems to really focus on getting those inmates healthy, though. Healthy and on good behavior.
Palantir Technologies Inc.
Market Cap: $37 billion
Palantir is a prison stock and tech company that works with big data. In fact, that’s what they do best. They have a host of clients, but they also provide services for prisons. Surveillance is a large service they provide in this arena.
They are way ahead of the game with their technology. And they’ve been able to provide some impressive applications and solutions. Palantir is a global company, operating in many different sectors. Including military, business, and non-profits.
It’s likely they’ll do well in the future because there could be technological surveillance at the border. And the tech could be even more advanced than surveillance only. They also recently renewed a contract with ICE for $49 million in 2020.
In 2021, they’ve partnered with the Army. Also, Amazon, Space Force, the Coast Guard, and many other organizations.
Palantir founded in 2003. Shortly after, it received funding and a contract from the CIA for its software. A bit later, it went public and offered stock.
Plus, leadership looks great. It’s still run by the co-founders, and it’s doing well. The CEO, Alex Karp, has a net worth of over $2 billion.
And, the large market cap shows just how well it’s been doing.
How Do Prisons Make Money?
Private prisons make money by signing contracts with the government. These agreements allow the government to house prisoners at the private prisons. And the prisons collect a daily fee for housing them.
There are other ways prisons make money, too. As discussed above, prison companies can offer services to other prisons. Also, other various projects and contracts, like coming up with innovations. Then, they’ll offer that innovation to other companies and industries.
“The Final Word” and Other Prison Stock Opportunities
Prison stocks may be unheard of, but the potential for profit is clearly alive. There are very few publicly traded companies who provide prisons and prison services. But, those that are around have been for a long time. They are stable and adaptable. And, a couple of them even pay out some dividends.
About Vanessa Adelman
Vanessa Adelman graduated with an Interdisciplinary degree. She majored in Entrepreneurship, Painting, Music and Film. Shortly after, she received a copywriting mentorship with Mark Morgan Ford. Then, she earned her AWAI Verification. Now, Vanessa freelances in the financial direct response industry. She’s been investing since 2016. In her free time, she enjoys books about money and wealth. She loves being with her boyfriend, hunting, fishing and going on outdoor adventures.