What are private prisons and how do they work?

Private prisons are correctional facilities that are managed by third-party companies under contract with government agencies. Unlike state-run prisons, these facilities are operated by for-profit corporations like CoreCivic and The GEO Group. They generate revenue through government contracts that typically pay a set amount per inmate housed. These companies may also provide additional services such as inmate transportation, healthcare, and rehabilitation programs, creating multiple revenue streams within the corrections system.

Why are law enforcement stocks considered non-cyclical?

Law enforcement and prison stocks are often considered non-cyclical because their revenue primarily comes from government contracts and public safety budgets, rather than consumer spending. Public safety is considered an essential service that governments must maintain regardless of economic conditions. This means that companies in this sector often experience more stable demand for their products and services even during economic downturns, when other industries might struggle. However, they can be affected by policy changes and budget priorities at various government levels.

What is "Consensus Recommendation" in stock analysis?

Consensus Recommendation is an average of what professional analysts think about a stock. It combines multiple expert opinions into a single rating to help investors understand how the financial community views the stock's potential. Ratings typically range from "Strong Buy" to "Strong Sell." A positive consensus might suggest that analysts generally believe the stock will outperform the market, while a negative consensus might indicate concerns about the company's prospects. This metric can be particularly helpful for newer investors as it summarizes professional analysis in an easy-to-understand format.

What does "Market Cap" mean when looking at stocks?

Market Cap (short for Market Capitalization) represents the total value of a company's outstanding shares in the stock market. It's calculated by multiplying the current share price by the total number of shares available. Market Cap helps investors understand the size of a company: large-cap companies (typically over $10 billion) are usually more established with stable growth, mid-cap companies ($2-10 billion) might offer a balance of growth and stability, and small-cap companies (under $2 billion) potentially offer higher growth but with increased risk. In the Prison & Enforcement collection, companies range from small-cap security technology startups to larger established corporations.

15 handpicked stocks

Prison & Enforcement

This carefully selected portfolio focuses on companies operating in public safety and corrections. These stocks represent firms with steady, government-backed revenue streams that tend to perform independently of broader economic trends.

Han Tan | Market Analyst

Updated 2 days ago | Published at juin 17