One-glance verdict
Undervalued
$46.80 our estimate vs market $32.34
Wall Street consensus: $42.20 (-9.8% lower than our fair-value estimate)
31% below our estimate, below the bear case
Fundamentals snapshot
CoreCivic, Inc.
CXW · NYQ · Industrials · Security & Protection Services
Current price
$32.34
52-week range
$15.74 - $36.55
Market cap
$2.80B
Balance sheet
Stretched
3.54x Stretched
Net debt $121.73M. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
2 Risks
3 rewards · 2 risks
- Reward Revenue grew 19.7% last year.
- Reward Returns 77.1% on equity, ahead of 75% of its peers.
- Risk Forward P/E (14.1x) is higher than trailing (2.1x) - earnings are expected to drop.
- Risk Net debt grew 1.3% over 3 years.
What this company does
CoreCivic, Inc.
CoreCivic, Inc. is a company that runs prisons and places for people transitioning back into society for the government. Most of their money comes from contracts with government agencies to house inmates and provide services, which is important because it means their income is often predictable. They offer various programs like education and job training within these facilities to help people avoid reoffending.
How the company got here
CoreCivic, originally founded as Corrections Corporation of America in 1983, was a pioneer in the privatization of correctional facilities. The company grew by providing services to government agencies needing to manage and operate correctional and detention facilities. A significant shift occurred in 2013 when CoreCivic elected to be taxed as a real estate investment trust (REIT), highlighting the value of its owned real estate portfolio. In 2016, the company rebranded to CoreCivic to reflect a broader focus beyond just incarceration, including reentry services and government real estate solutions. However, in 2021, CoreCivic transitioned back to a taxable C-corporation status, aiming for greater strategic and financial flexibility. The company's history is marked by expansion, strategic realignments, and adaptation to evolving public policy and market demands within the corrections and detention sector.
What it actually does
CoreCivic provides a range of services and solutions primarily to government agencies in the United States. These services revolve around managing correctional and detention facilities, offering residential reentry programs to help individuals transition back into society, and providing specialized real estate solutions for government correctional needs. Essentially, CoreCivic partners with federal, state, and local governments to offer secure and efficient management of correctional infrastructure and services, aiming to support public safety and reduce recidivism.
CoreCivic Safety
This is the largest segment of CoreCivic's business, generating the vast majority of its revenue. CoreCivic Safety focuses on owning, managing, and operating correctional and detention facilities for government partners. This includes prisons, jails, and immigration detention centers. The company provides the physical infrastructure, staffing, and operational management necessary to house and manage inmates and detainees, offering services like security, food, healthcare, and rehabilitation programs within these facilities. The demand for this segment is driven by government needs for correctional capacity and management services.
CoreCivic Community
The CoreCivic Community segment is focused on providing services that help individuals reintegrate into society after incarceration. This includes operating residential reentry centers, often referred to as halfway houses, where individuals can live while participating in programs designed to reduce the likelihood of reoffending (recidivism). These programs can include job training, education, substance abuse treatment, and life skills development. This segment represents a smaller but important part of CoreCivic's overall business, addressing the critical need for successful rehabilitation and community reintegration.
CoreCivic Properties
In this segment, CoreCivic acts as a specialized real estate provider. It owns a portfolio of correctional and detention facilities that it leases to government agencies or other third-party operators. This allows governments to utilize secure correctional infrastructure without the burden of direct ownership and management, or it provides facilities for other operators. This segment leverages CoreCivic's expertise in developing and managing specialized real estate assets within the corrections sector, offering flexibility to government partners.
What management is betting on now
CoreCivic's current strategy centers on maximizing the utilization of its existing assets and expanding its service offerings. Management is focused on reactivating idle or underused facilities to meet growing demand, particularly for immigration detention beds. They are also looking to grow the lease-based solutions within the Properties segment, offering more real estate-focused services to government clients. Improving staffing stability and operational efficiency are key priorities to ensure reliable service delivery. Additionally, the company is exploring innovations and strategic partnerships through CoreCivic Ventures to identify and scale new solutions within the justice ecosystem, aiming for sustainable long-term growth.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q4
$16.01M
FY2025 Q1
$19.95M
FY2025 Q2
$61.85M
FY2025 Q3
$16.11M
FY2025 Q4
$-45.13M
FY2026 Q1
$-6.92M
FY2026 Q2
$94.91M
FY2026 Q3
$-438.22M
Revenue
$744.09M
Net income
—
Diluted EPS
14.49
Operating cash flow
$-413.39M
Free cash flow
$-438.22M
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Sources
Revenue
$684.92M
Net income
—
Diluted EPS
0.37
Operating cash flow
$133.00M
Free cash flow
$94.91M
Fetching…
Sources
Revenue
$614.73M
Net income
—
Diluted EPS
0.38
Operating cash flow
$13.77M
Free cash flow
$-6.92M
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Sources
Revenue
$603.95M
Net income
—
Diluted EPS
0.26
Operating cash flow
$-376.00K
Free cash flow
$-45.13M
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Sources
Revenue
$580.44M
Net income
—
Diluted EPS
0.24
Operating cash flow
$53.77M
Free cash flow
$16.11M
Fetching…
Sources
Revenue
$538.16M
Net income
—
Diluted EPS
0.35
Operating cash flow
$96.71M
Free cash flow
$61.85M
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Sources
Revenue
$488.63M
Net income
—
Diluted EPS
0.23
Operating cash flow
$44.48M
Free cash flow
$19.95M
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Sources
Revenue
$479.29M
Net income
—
Diluted EPS
0.18
Operating cash flow
$39.27M
Free cash flow
$16.01M
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Sources
Is it cheap or expensive?
Fair value $46.80 vs current price $32.34
Wall Street consensus is the average analyst price target: $42.20 (-9.8% lower than our fair-value estimate).
Our most-likely fair value is $46.80 a share — about 44.7% above today's price of $32.34, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Stretched
Net debt $121.7M. Interest coverage 3.5x.
Net debt
$121.73M
Interest coverage
3.54x
CoreCivic, Inc.'s profit covers its interest bill about 3.5 times over. which is stronger than every peer shown here and 1 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Stretched
Worse cushion
Baseline
Better cushion
CXW
BASELINE
CoreCivic, Inc.
Total debt $668.96M Interest coverage 3.54x This is the baseline the peer rows are being compared against.
Total debt $1.66B Interest coverage 1.84x -48% vs CXW Carries about 1.9x less debt cushion than CXW.
Total debt $3.37M Interest coverage -3.19x -100% vs CXW This peer has almost no interest-payment cushion compared with CXW.
Total debt $4.47B Interest coverage 2.40x -32% vs CXW Carries about 1.5x less debt cushion than CXW.
What you should know
The case for and against CXW
3 Rewards
2 Risks
Rewards
-
Revenue grew 19.7% last year.
-
Returns 77.1% on equity, ahead of 75% of its peers.
-
Free cash flow was positive in 9/10 years.
Risks
-
Forward P/E (14.1x) is higher than trailing (2.1x) - earnings are expected to drop.
-
Net debt grew 1.3% over 3 years.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
2.14x
Forward P/E
14.07x
P/B
1.23x
P/S
1.06x
EV/EBITDA
7.11x
PEG ratio
1.06x
Profitability
How much profit each dollar creates
Gross margin
22.2%
Operating margin
10.0%
Net margin
54.6%
ROE
77.1%
ROA
4.9%
Health
Liquidity and balance-sheet strength
Debt / equity
0.29x
Current ratio
2.41x
Quick ratio
2.15x
Total debt
$668.96M
Total cash
$547.23M
Growth
How the business has been compounding
Revenue TTM
$2.65B
Revenue 5Y CAGR
4.4%
EPS TTM
15.14
EPS 5Y CAGR
1.6%
Cash flow
How much cash the business throws off
Operating CF TTM
$-267.00M
Free CF TTM
$52.79M
FCF margin
2.0%
Dividend
Shareholder payout
Yield
0.0%
Payout ratio
0.0%
Last ex-div date
2020-03-31