Corrections of America Earnings: Here’s Why the Stock is Down Now

Corrections Corporation of America (NYSE:CXW) delivered a profit and beat Wall Street’s expectations, BUT came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are down 0.42%.

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Corrections Corporation of America Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 51.52% to $0.50 in the quarter versus EPS of $0.33 in the year-earlier quarter.

Revenue: Decreased 2.21% to $425.7 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Corrections Corporation of America reported adjusted EPS income of $0.50 per share. By that measure, the company beat the mean analyst estimate of $0.47. It missed the average revenue estimate of $429.6 million.

Quoting Management: CCA President and Chief Executive Officer, Damon Hininger, stated, “Revenues were in line with our expectations while operating expenses were lower than forecasted, which resulted in earnings above our guidance range.” Hininger continued, “On May 20, 2013, we will distribute the special dividend completing our requirement to distribute our pre-REIT accumulated earnings and profits, which is the final step necessary to complete our conversion into a REIT effective January 1, 2013.”

Key Stats (on next page)…

Revenue decreased 2.55% from $436.86 million in the previous quarter. EPS increased 13.64% from $0.44 in the previous quarter.

Looking Forward: Analysts have a more positive outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has risen from a profit of $0.41 to a profit $0.51. For the current year, the average estimate has moved up from a profit of $1.62 to a profit of $2.00 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)