Placing my personal beliefs aside, I decided that logically speaking, the policies of the federal government and the individual states will likely include an increase rather than a decrease in prison populations over the near future. So I invested in GEO in August 2016. And then, just days after my purchase, the price of GEO fell sharply after the U.S. Department of Justice announced that it would not be renewing contracts with private prison companies going forward.
The lowest I noticed the price fall resulted in about a 40% paper loss. I did some extra research on GEO, and determined that if what I read was true, the business model for GEO would not be severely affected over time, and determined further that the market price movement after the DOJ decision was an overreaction. I stood firm on the investment, and since then, the price of GEO recuperated, kept climbing, and recently was at or near new highs.
My investment in GEO has so far resulted in a very nice increase in price. Although I anticipated a dividend increase in late 2016, that did not come to fruition, but there has been a dividend increase early in 2017. Given the current high dividend yield that GEO provides, and given the significant dividend increase that was recently announced, this investment will provide far more than its fair share of the average monthly income needed in this portfolio, assuming that current trends continue over the next nineteen years.
Although GEO's price movement has been dizzying over the past few months, profits appear to be stable. Although I would likely not invest any more in GEO at this time, I anticipate that I will hold it for the foreseeable future as long as business conditions remain the same going forward.
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