Financial Sector Ideas

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General Payment Systems -



http://www.minyanville.com/trading-and-investing/stocks/articles/Michael-Milken-Martha-Stewart-Dennis-Kozlowski/10/9/2013/id/52143?camp=syndication&medium=portals&from=yahoo&refresh=1



>>> Here, then, are some stocks for the slammer.


1. Corrections Corporation of America (NYSE:CXW) is the undisputed industry leader, operating approximately 67 detention facilities in 20 states. Based in Nashville -- whose favorite sons know how to fulsomely Cash in on prisons -- the stock is approximately 90% owned by institutions and sports a market capitalization of about $4 billion. Shares are essentially flat over the past year, but a roughly 5.64% dividend offers real appeal should the market enter a sustained correction, so to speak. Recent overcrowding reduction proposals in California are an additional avenue of growth for the company. As ever, any prospective investors should consult their tax adviser regarding the reporting requirements of real estate investment trust (REIT)-related names.

2. Boca Raton-based The GEO Group, Inc. (NYSE:GEO) has returned roughly 14% in the past 12 months, broadly on a par with the Dow Average (INDEXDJX:.DJI). The security stock either owns or manages about 100 facilities, with its services encompassing everything from parolee supervision to rehabilitative outreach. It did $377 million in revenues in the most recent quarter, has a price/earnings ratio of roughly 13, and boasts a plump 6.10% yield. The firm survived a stadium-naming fiasco earlier this year, and it is expected to benefit from the burgeoning market for immigrant detention centers.

The next two names are definitely not for widows and orphans, a cohort already badly burned by the high crimes of Madoff et al. When they trade at all, it is highly irregularly and on the pink sheets, so buyer beware.

3. Avalon Correctional Services (OTCMKTS:CITY), founded in 1985, hails from Houston and involves itself with inmate education among other issues. It operates in Oklahoma, Texas, and Wyoming. Personally, I stay away from penny stocks, but you never know. A little bird (Twitter’s mountain bluebird, as opposed to the Birdman of Alcatraz, who currently finds himself furloughed by Uncle Sam) told me that once in a blue moon, such speculative issues do shoot up.

4. General Payment Systems (OTCMKTS:GPSI) has gained 445.45% in the past year, but considering that still leaves the stock trading at only $0.60, it continues to go for a song. (Even in Sing Sing.) The Las Vegas company changed its name from Continental Prison Systems in September and has 10,841,741 shares outstanding as of last count. In a just published interview, ex-Qwest CEO Joseph Nacchio told of a torturous time behind bars, where his "money" was mackerel and tuna. (Poor fellow; doesn't he know that Whole Foods (NASDAQ:WFM) offers an altogether more upscale penitentiary tilapia? And to think, they say no big fish have gone to jail for the financial crisis.) Regardless, such a sad plight shed fresh light on the issue of incarceration currency. This firm provides debit card and kiosk products aimed at creating cashless technology that begins with the booking process. These proceeds can then be automatically loaded into the prisoner’s account, thus eliminating much manual labor. In 2012, General Payment Systems posted more than $4 million in revenue, and shares recently underwent a 1-100 reverse split.

So there we have it -- four jail stocks to score with. Perhaps you’ve never considered investing in prisons before. But why not try something different? After all, they say a change is as good as arrest

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