What are your thoughts on GEO's latest results and outlook. Would you add to a position with a 2-3 year timeframe?
Many Thanks!
Colin
EPS of $0.04 missed expectations of $0.13 and revenue of $32.63M missed expectations of $39.2M. Sales declined 17% over the prior year and Adjusted EBITDA declined to $6.2M from $11.9M in the previous year, and its Adjusted EBITDA margins shrunk from 29% to 19%. Its outlook expects a continued increase in demand for drilling services, driven by a robust mining and exploration cycle, and it is benefitting from the favorable impact of the strong gold price. Overall, results were negatively impacted by lower than expected results and its decision to withdraw from Burkina Faso. The results were not great and the stock has dropped ~20% since. It's one of the company's first misses since 2020 and we feel that given its weaker results, that it may consolidate for a bit before its next earnings report.