Donald Trump’s victory in the 2024 presidential election has sparked a remarkable rally in private prison stocks, and one particular name—Geo Group (NYSE: GEO)—has been thrust back into the spotlight.
It’s an old favorite of Michael Burry, famed for his role in “The Big Short,” though the legendary investor missed out on the recent gains after selling too early.
GEO Group shares, which had collapsed from over $12 to around $7 during Q1 2023, initially lured Burry into a $5 million bet in Q2 2023 through his Scion Asset Management.
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By the end of Q3, he held 600,000 shares worth approximately $4.8 million. Assuming he bought near Q2 lows at $7, Burry likely pocketed a modest gain of just over $500,000 before clearing his position in the same quarter.
GEO stock performance
However, the stock’s trajectory since then has been nothing short of explosive.
After starting to climb in late September 2023, GEO shares have surged dramatically following Trump’s election win. The stock was trading at $15.13 on November 5—Election Day—and has nearly doubled since, currently priced at $29.13.
The climb represents a staggering 92.5% increase in just over a month, making GEO Group one the top performers in the S&P 500 during this period.
If Burry had held onto his original 600,000-share stake, its current value would be approximately $17.48 million. This means that by exiting the position prematurely, he missed out on nearly $12.68 million in potential profits.
The resurgence in GEO Group’s valuation can largely be attributed to Trump’s victory, as his administration is expected to reinstate policies favorable to private prison operators.
These companies had faced headwinds under the Biden administration, but Trump’s win has reignited investor confidence
For Burry, the missed opportunity underscores the challenge even the sharpest investors face in timing the market. While his initial bet on GEO Group turned a profit, holding it long-term could have yielded a significantly greater windfall.
