Advice: Is now a good time to invest in a private prison company?


I’ve seen several stories now on private prison companies’ stocks rising because of President Trump’s election. (Most recently, this story: http://pbpo.st/2oJc6in) But it seems like they’re really a roller-coaster stock. Last year, I was reading about how they were plunging. Politics aside, would this be a solid, long-term investment? Or is it too politically tied to be stable?

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  1. No idea on the financial benefit but for me personally it would be like investing in a cigarette company about to make a lot of profit or investing in united airlines after the incident last week. Sure you could but morally I find it objectionable.

  2. The longer term trend is away from private prisons because they’ve largely failed to cut costs while maintaining adequate security. The slow long term trend against incarceration by the criminal justice system, plus the probable continuance of the trend decriminalizing marijuana, lead me to believe that the need for cell space is probably unlikey to increase long term.

    While an immigration crackdown might cause a spike in need for cells (and something like three quarters of all ICE detainees are in the custody of private facilities), one would anticipate that’s already priced into the current share price (which, according to your article, it is).

    So I would not call it a good long term buy, and buying now feels like buying at the peak.

  3. I posted this last time someone asked about a private prison stock (GEO):

    Money is money, and it’s up to the individual how they choose to invest but the private prison industry is some evil ass shit. They are making money and growing but it’s through the misfortune and hardship of others. Their business model is to keep people in jails as long as possible and fill as many beds as possible. Because of this there have been numerous cases of neglect (probably to maintain margins) and suspicious activities like colluding with judges and ICE to detain more people for longer periods of times. There have been cases of detaining undocumented immigrant families, including mothers and children, for extended periods of times (up to 6 months) without bringing forth formal charges. One thing interesting about them is how reliant they are on political climate and the government’s stance on the private prison industry, because their revenue is so dependent on government contracts. Obama, before he left office was trying to end federal contracts to private prisons. You will notice that they went through a dip in the 2016 when there was a lot of negative press about some of these prisons (their practices and conditions) and increasing protests to close them down. The ramp up to the elections, the reversal of this administration’s stance, and renewing/expanding private prison contracts has led to much of the growth. You will notice the spike started post election. Up to you though, GEO is up over 40% in the last year so I know why people would want to invest in them.

  4. The [US has the highest incarceration rate in the world](https://en.wikipedia.org/wiki/United_States_incarceration_rate). That actually means we are fucking up with a lot of aspects of government. That rate needs to decrease, it is expensive.

    I would not be a buyer of any prison or legal stock. The one thing we know is they are fucking up royally.

    Go to Youtube and see if you can find a video of a US Cop beating someone. I bet you find a thousand. Those are all law suits. And it is worse on the inside.

  5. Under the current presidency it may not be bad.

    But, I would be very nervous to invest in the scam that is private prisons. As soon as America figures out how fucked that whole system is, private prisons will be no more, thus the stock plunges.

  6. Good business idea if you think it is moral right. I would do that however. ); But on this subject, take my comments with a pinch of salt, cos i am a novice in prison matters and stock.

  7. I hope all private prisons go bankrupt and anyone who’s invested in them loses all the money that they have (all the money invested in private prisons, that is)

    Big Tobacco and Big Pharma are less morally and ethically questionable than private prisons.

    No prison should ever be run for-profit. It’s abhorrent.

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