Are Your Stocks in Prison?

This private prison industry is an interesting business. However, stocks in this arena have been relatively flat over the last five years. One reason; since 2001, violent crime rates have dropped every year, according to the census bureau. This statistic is for both total number of crimes and the number of crimes per 100,000. But maybe this information is built into the prices of these stocks, and maybe there are some buying opportunities to help your portfolio get out of jail.

The largest company in this business, according to the free list of prison stocks at WallStreetNewsNetwork.com, is Corrections Corporation of America (CXW), a Nashville, Tennessee owner and operator of privatized correctional and detention facilities in 20 states. The stock trades at 17.5 times current earning, and 15.5 times future earnings, with a generous yield of 3.1%. Although quarterly revenues were up 2.4%, earnings for the latest quarter tanked over 21%. This was primarily due to the $4 million of start-up costs at Jenkins and Cimarron, the reduction in U.S. Marshals populations at certain facilities, and an increase in employee medical and workers' compensation claims.

The second largest is Geo Group (GEO) which trades at 17.8 time current earnings and at 13.2 times forward earnings. The company operates in the United States, Australia, South Africa, the United Kingdom, and Canada as a provider of government-outsourced services, primarily correctional, detention, mental health, residential treatment, and re-entry facilities. Earnings dropped 10.5% on a revenue increase of 5.3%.

The short list of prison stocks is available at WallStreetNewsNetwork.com, which can be downloaded, updated, and sorted.

Disclosure: Author didn't own any of the above at the time the article was written.

By Stockerblog.com

The Crime Rate is Down: Check Out Anti Crime Stocks

The Federal Bureau of Investigation recently came out with the nationwide crime statistics, and the results are quite surprising. The overall crime rate is down for 2009, way down. Violent crime is down 5.5%, murder is down 7.2%, robbery down 8.1%, property crime down 4.9%, larceny theft down 4.2%, and motor vehicle theft down 17.2%. As a matter of fact, the crime rate has been dropping in all these areas since 2006. This is in spite of the fact that we have had a bad economy, a huge influx of illegal immigrants, high unemployment, a large number of job losses, a substantial number of foreclosures, numerous individual and corporate bankruptcies, and loss of wealth overall.

Why is this happening? Maybe everyone in law enforcement and crime fighting are doing their jobs better and more efficiently. Perhaps colleges and the best online criminal justice schools are preparing students better for law enforcement jobs and they are better able to keep the peace. Maybe the businesses involved in stopping crime are improving and putting a stop to felonies and misdemeanors. Maybe the bad economy has caused people to become more moral.

If the companies involved in helping law enforcement are a part of this, then maybe there is an investment opportunity in crime fighting stocks. Here are some companies that battle crime in various ways.

TASER International Inc. (TASR), which trades on NASDAQ, manufactures product lines for law enforcement and the prison corrections market, which includes the ADVANCED TASER M26 and the TASER X26. The stock recently generated zero earnings, and has a PEG ratio of 2.06.

iRobot Corp. (IRBT), another NASDAQ stock, makes robotic products for the law enforcement and the homeland security markets. The make a product called the PackBot EOD, which is a strong lightweight robot to conduct explosive disposal, hazardous materials, and search-and-surveillance for bomb squads and SWAT teams. The stock has a P/E of 47 and PEG of 2.46.

Brinks Co. (BCO) is in the business of transportation and cash logistics services, and also provides electronic security systems for single-family residences, commercial properties and multifamily housing. The stock has a P/E of 5.8, a PEG of 1.31, and pays a yield of 1.9%.

The largest private prison system by both market cap and revenues is Corrections Corp. of America (CXW), which is a Nashville, Tennessee based company with over 40 facilities. It has a P/E of 14.5 and a PEG of 1.38. The stock trades on the New York Stock Exchange.

The second largest prison company is Geo Group Inc. (GEO), based in Boca Raton, Florida. They have facilities in the United States, Australia, Canada, South Africa, and UK. It has a P/E of 14.5 and PEG is .98. The stock trades on the NYSE.

Cornell Companies Inc. (CRN) is a Houston, Texas prison company, which in addition to providing detention services, also provides educational services to detainees. It has a P/E of 16.5 and a PEG of 2.09. It trades on the NYSE.

Smith & Wesson Holding Corporation (SWHC) provides firearms to the law enforcement and security industry. The company also has the Universal Safety Response division, Inc., a full-service perimeter security provider. The stock has a PE of 6.5 and a PEG of 0.71.

Another firearm company is Sturm, Ruger & Co. Inc. (RGR). The stock has a PE of 9.6 and pays a yield of 2.5%.

If you like lists of stocks in interesting industries, check out the numerous lists at WallStreetNewsNetwork.com.

Author owns RGR.

By Stockerblog.com