13 Most Undervalued Stocks Under $20 to Buy

2. The GEO Group, Inc. (NYSE:GEO)

Share Price: $15.41

Forward P/E: 11.63

Number of Hedge Fund Holders: 49

The GEO Group, Inc. (NYSE:GEO) is among the 13 Most Undervalued Stocks Under $20 to Buy. On November 7, Jones Trading slashed the stock’s price target to $37 from $50, citing the company’s slow growth as the reason behind the adjustment.

Despite the downward revision, the new price target reflects a 142% upside potential. Moreover, the firm said that it has a positive outlook for all business segments of the company, reflected in the reiteration of its earlier Buy rating on the stock.

In September this year, The GEO Group, Inc. (NYSE:GEO)’s subsidiary, BI Incorporated, secured a two-year contract from the U.S. Immigration and Customs Enforcement to continue delivering services for the Intensive Supervision Appearance Program (ISAP).

Jones Trading described the contract award as a significant opportunity for the company, while noting that ISAP could continue to face challenges until ICE expands its detention capacity to its target of 100,000.

In other news, on November 6, The GEO Group, Inc. (NYSE:GEO) reported financial results, with revenues up 13% year-over-year to $682.3 million, and net income soaring to $174 million from a mere $26 million a year ago.

However, the strong results were overshadowed by its fourth-quarter guidance, which fell short of analysts’ estimates and disappointed investors. The stock is down by over 10% since the announcement, closing at $14.98 on Monday, November 10.

The GEO Group, Inc. (NYSE:GEO) is a government services provider, with a focus on developing, financing, and supporting secure facilities, community reentry centers, and processing facilities.