CORECIVIC INC (NYSE:CXW) stands out as a high-growth momentum candidate with a solid technical setup. The company, which operates correctional and detention facilities, has shown notable earnings momentum alongside a favorable chart pattern. Below, we examine why CXW meets the criteria for both growth and technical strength.
Growth Momentum Highlights
Strong Earnings Growth: CXW reported a 187.5% year-over-year EPS growth in the most recent quarter, with TTM EPS growth at 35.7%.
Positive Revisions: Analysts have raised next-year EPS estimates by 22.7% over the past three months, reflecting improving sentiment.
Free Cash Flow Surge: FCF per share grew 135.8% over the past year, indicating strong cash generation.
Consistent Earnings Beats: The company surpassed EPS estimates in each of the last four quarters, with an average beat of 74.5%.
Expanding Profit Margins: Quarterly profit margins improved from 3.87% three quarters ago to 5.14% in the latest report.
Technical Strength & Setup
CXW scores an 8 out of 10 on the ChartMill Technical Rating, supported by:
Positive Trends: Both short-term and long-term trends are upward, reinforcing bullish momentum.
Relative Strength: The stock outperforms 84% of its peers in the Commercial Services & Supplies industry.
Consolidation Pattern: Prices have been trading in a tight range ($21.31 - $23.54) over the past month, reducing volatility and setting up a potential breakout.
Support Levels: Multiple support zones exist between $19.06 and $22.09, providing downside protection.
A breakout above $22.50 could signal further upside, while a stop-loss near $21.87 offers defined risk.