CoreCivic Stock Plummets in 2025 Amid Growing Criminal Justice Reform Pressure

CoreCivic, Inc. (CXW), known formerly as Corrections Corporation of America until its rebranding in 2016, remains the largest private prison operator in the United States. This name change aimed to soften its public image, but recent events have brought its core business back into the spotlight. The stock experienced a significant sell-off coinciding with the widespread protests following George Floyd's death earlier this year, reflecting heightened investor concerns.

While CoreCivic had largely avoided widespread criticism until now, the growing movement for police and criminal justice reform is increasingly targeting the privatized incarceration system. The U.S. incarcerates 655 individuals per 100,000 population, a rate surpassing all other developed nations, including China. Comprehensive reform efforts could drastically reduce demand for private prisons, threatening the industry's viability.

Technically, CXW's stock recently reversed at its 200-day exponential moving average (EMA), after rebounding slightly from a 16-year low that narrowly undercut the 2009 bottom. Should the stock retrace further into this EMA or complete an 11-year breakdown pattern, it may trigger substantial sell signals, potentially continuing a gradual decline that began in 2017.

Long-Term Stock Performance (1997 – 2024)

CoreCivic went public in July 1997, debuting near $90 and quickly climbing to an all-time high close to $150 by the end of that year. However, aggressive bearish trends soon emerged, pushing shares down to a record low of 63 cents three years later. The stock recovered modestly, peaking at $33.40 in mid-2007 before plunging amid the 2008 financial crisis.

In March 2009, the stock found a higher low in the single digits and rallied to retest previous highs by 2012. Despite a brief breakout, buying momentum was weak, resulting in a double-top formation and subsequent breakdown during the August 2015 market correction. A V-shaped recovery followed the 2016 election, stalling near the 2007 peak in 2017.

Since then, CoreCivic has been in a slow decline, hitting a 16-year low in March 2020. A small bounce occurred in early June 2020, but the stock has surrendered over half of those gains amid recent protests. It remains precariously above the 2009 low of $9.50, with minimal support below, suggesting potential for further declines.

The monthly stochastic oscillator entered deeply oversold territory in March 2020, marking the most extreme reading in two decades. A bullish crossover in April failed to ignite buying interest, increasing the likelihood of a failed rally. Nonetheless, a short-term bounce toward the $13-$14 range, near the 2016 low and 200-day EMA resistance, remains possible.

Short-Term Stock Trends (2016 – 2024)

The On-Balance Volume (OBV) indicator hit a multi-year low in November 2016, followed by a modest accumulation phase until August 2018. Since then, OBV has deteriorated steadily, approaching a three-year low just above the deepest price dip. A breach of this level alongside a price breakdown would intensify bearish momentum.

Should CoreCivic's stock fall below $9.50, it could target its 2001 low near 63 cents, representing a full retracement over the long term. Given the stock's typically slow movement, this downside could take years to materialize and would likely require bankruptcy fears to accelerate the decline. Regardless, many investors view this sector as increasingly unsustainable amid reform pressures.

Conclusion

CoreCivic, the largest private prison operator in the U.S., faces mounting challenges as criminal justice reform gains momentum in 2024. The stock's technical and fundamental outlook suggests the potential for significant further declines, reflecting broader societal shifts away from privatized incarceration.

Disclosure: The author held no positions in CoreCivic (CXW) at the time of writing.

Discover engaging topics and analytical content in Company News as of 23-06-2020. The article titled " CoreCivic Stock Plummets in 2025 Amid Growing Criminal Justice Reform Pressure " provides new insights and practical guidance in the Company News field. Each topic is meticulously analyzed to deliver actionable information to readers.

The topic " CoreCivic Stock Plummets in 2025 Amid Growing Criminal Justice Reform Pressure " helps you make smarter decisions within the Company News category. All topics on our website are unique and offer valuable content for our audience.