Is GEO a high-quality business?

AlphaMadera's AlphaQuality grade scores The GEO Group, Inc. on six pillars — profitability, capital efficiency, balance-sheet strength, growth durability, cash generation, and shareholder yield. The composite letter grade reflects how GEO compares to a Buffett-style quality bar.

What is The GEO Group, Inc.'s AlphaQuality grade?

AlphaQuality assigns a letter grade (A through F) to GEO based on a six-pillar quantitative model. The live page shows the composite grade plus each pillar's individual score with the underlying metrics.

What makes GEO a quality stock?

AlphaQuality looks at return on capital, free-cash-flow margins, debt-to-equity, revenue stability, dividend and buyback policy, and operating-margin trend. Stocks scoring well across all six pillars earn higher grades — the methodology favors compounders over cyclicals.

GEO - The GEO Group, Inc.

Price: -- -- | CONSENSUS: Buy DETAILS | PRICE TARGET: $24.50 DETAILS

AlphaQuality

Quantitative six-pillar business-quality grade

Stable Earnings Power

AlphaQuality — archetype-weighted quantitative grade

C 55.2 / 100 composite

Composite Grade

Composite of six pillars weighted for stable earnings power businesses. Purely quantitative — no stock price or analyst input.

Profitability

Weight: 20%

D+ 42.8

5yr Avg ROIC 8.3% 52/100
Operating Margin Trend -0.93 pp/yr 22/100

Capital Efficiency

Weight: 15%

D 38.8

5yr Avg ROE 8.5% 53/100
5yr Share-Count CAGR 3.7% 13/100

Growth Quality

Weight: 15%

B 74.3

5yr Revenue CAGR 3.9% 52/100
5yr EPS CAGR 33.1% 100/100
Revenue-Growth Years (5) 4/5 80/100

Cash Generation

Weight: 15%

B- 64.5

5yr FCF Margin 5.8% 53/100
5yr FCF/NI Conversion 2.11x 78/100

Balance Sheet

Weight: 20%

C 52.3

Net Debt / EBITDA 2.62x 58/100
Interest Coverage (EBIT/Int) 3.12x 46/100
Altman Z-Score 2.29 50/100

Stability

Weight: 15%

B- 62.4

EPS Volatility (σ/μ) 0.41 42/100
Piotroski F-Score 7 78/100
Negative-Revenue Years (5) 1/5 80/100

3 of 3 gurus held; 2 added; 1 trimmed; 1 full exit.

Holders: 3
Avg Δ position: +36.2%
New buys: 0
Full exits: 1

Greenblatt sold -100%
Wood increased +102%
Cooperman increased +78%

How this is calculated

AlphaQuality grades six pillars from 0-100 and weights each by archetype:

Profitability (20%) — 5yr Avg ROIC, Operating Margin Trend
Capital Efficiency (15%) — 5yr Avg ROE, 5yr Share-Count CAGR
Growth Quality (15%) — 5yr Revenue CAGR, 5yr EPS CAGR, Revenue-Growth Years (5)
Cash Generation (15%) — 5yr FCF Margin, 5yr FCF/NI Conversion
Balance Sheet (20%) — Net Debt / EBITDA, Interest Coverage (EBIT/Int), Altman Z-Score
Stability (15%) — EPS Volatility (σ/μ), Piotroski F-Score, Negative-Revenue Years (5)

We deliberately ignore stock price, analyst targets, and consensus ratings so the grade is suitable for backtesting forward returns. A minimum of 5 fiscal years of audited statements is required; distressed and highly leveraged infrastructure businesses are declared ungradable rather than forced into a numeric score.