We assign a fundamental rating of 5 out of 10 to CXW. CXW was compared to 80 industry peers in the Commercial Services & Supplies industry. CXW has only an average score on both its financial health and profitability. CXW is not valued too expensively and it also shows a decent growth rate.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

In the past year CXW was profitable.
In the past year CXW had a positive cash flow from operations.
Of the past 5 years CXW 4 years were profitable.
Each year in the past 5 years CXW had a positive operating cash flow.

1.2 Ratios

CXW has a better Return On Assets (3.51%) than 68.75% of its industry peers.
Looking at the Return On Equity, with a value of 7.43%, CXW is in the better half of the industry, outperforming 63.75% of the companies in the same industry.
CXW has a Return On Invested Capital of 5.58%. This is comparable to the rest of the industry: CXW outperforms 60.00% of its industry peers.
CXW had an Average Return On Invested Capital over the past 3 years of 4.72%. This is significantly below the industry average of 10.58%.
The last Return On Invested Capital (5.58%) for CXW is above the 3 year average (4.72%), which is a sign of increasing profitability.

		Industry Rank	Sector Rank
ROA	3.51%
ROE	7.43%
ROIC	5.58%

ROA(3y)2.77%

ROA(5y)1.65%

ROE(3y)5.91%

ROE(5y)3.57%

ROIC(3y)4.72%

ROIC(5y)4.97%

1.3 Margins

With a decent Profit Margin value of 5.24%, CXW is doing good in the industry, outperforming 66.25% of the companies in the same industry.
In the last couple of years the Profit Margin of CXW has declined.
CXW has a Operating Margin of 10.22%. This is in the better half of the industry: CXW outperforms 70.00% of its industry peers.
CXW's Operating Margin has declined in the last couple of years.
Looking at the Gross Margin, with a value of 24.13%, CXW is doing worse than 60.00% of the companies in the same industry.
CXW's Gross Margin has declined in the last couple of years.

		Industry Rank	Sector Rank
OM	10.22%
PM (TTM)	5.24%
GM	24.13%

OM growth 3Y-11.18%

OM growth 5Y-7.87%

PM growth 3YN/A

PM growth 5Y-18.12%

GM growth 3Y-5.42%

GM growth 5Y-3.25%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so CXW is destroying value.
Compared to 1 year ago, CXW has less shares outstanding
The number of shares outstanding for CXW has been reduced compared to 5 years ago.
Compared to 1 year ago, CXW has an improved debt to assets ratio.

2.2 Solvency

Based on the Altman-Z score of 1.65, we must say that CXW is in the distress zone and has some risk of bankruptcy.
CXW has a Altman-Z score (1.65) which is comparable to the rest of the industry.
CXW has a debt to FCF ratio of 9.24. This is a negative value and a sign of low solvency as CXW would need 9.24 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 9.24, CXW is in the better half of the industry, outperforming 61.25% of the companies in the same industry.
A Debt/Equity ratio of 0.70 indicates that CXW is somewhat dependend on debt financing.
CXW has a Debt to Equity ratio of 0.70. This is comparable to the rest of the industry: CXW outperforms 43.75% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	0.7
Debt/FCF	9.24
Altman-Z	1.65

ROIC/WACC0.68

WACC8.21%

2.3 Liquidity

A Current Ratio of 1.41 indicates that CXW should not have too much problems paying its short term obligations.
CXW has a Current ratio (1.41) which is in line with its industry peers.
A Quick Ratio of 1.41 indicates that CXW should not have too much problems paying its short term obligations.
The Quick ratio of CXW (1.41) is comparable to the rest of the industry.

		Industry Rank	Sector Rank
Current Ratio	1.41
Quick Ratio	1.41

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 49.25% over the past year.
The earnings per share for CXW have been decreasing by -17.17% on average. This is quite bad
CXW shows a small growth in Revenue. In the last year, the Revenue has grown by 5.72%.
Measured over the past years, CXW shows a decrease in Revenue. The Revenue has been decreasing by -0.19% on average per year.

EPS 1Y (TTM)49.25%

EPS 3Y25.31%

EPS 5Y-17.17%

EPS Q2Q%26.32%

Revenue 1Y (TTM)5.72%

Revenue growth 3Y1.74%

Revenue growth 5Y-0.19%

Sales Q2Q%18.08%

3.2 Future

Based on estimates for the next years, CXW will show a very strong growth in Earnings Per Share. The EPS will grow by 57.86% on average per year.
The Revenue is expected to grow by 13.48% on average over the next years. This is quite good.

EPS Next Y67.89%

EPS Next 2Y57.86%

EPS Next 3YN/A

EPS Next 5YN/A

Revenue Next Year12.2%

Revenue Next 2Y13.48%

Revenue Next 3YN/A

Revenue Next 5YN/A

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.

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4. Valuation

4.1 Price/Earnings Ratio

With a Price/Earnings ratio of 20.13, CXW is valued on the expensive side.
Compared to the rest of the industry, the Price/Earnings ratio of CXW indicates a somewhat cheap valuation: CXW is cheaper than 72.50% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.32, CXW is valued a bit cheaper.
A Price/Forward Earnings ratio of 13.24 indicates a correct valuation of CXW.
CXW's Price/Forward Earnings ratio is rather cheap when compared to the industry. CXW is cheaper than 85.00% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of CXW to the average of the S&P500 Index (24.32), we can say CXW is valued slightly cheaper.

		Industry Rank	Sector Rank
PE	20.13
Fwd PE	13.24

4.2 Price Multiples

Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of CXW indicates a somewhat cheap valuation: CXW is cheaper than 75.00% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, CXW is valued a bit cheaper than 73.75% of the companies in the same industry.

		Industry Rank	Sector Rank
P/FCF	18.64
EV/EBITDA	9.09

4.3 Compensation for Growth

CXW's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
CXW's earnings are expected to grow with 57.86% in the coming years. This may justify a more expensive valuation.