Target Hospitality gains after revived deal with CoreCivic on Texas detention center

Corecivic

06/03/2025 17:01

** Target Hospitality's TH.O shares up 6.9% at $5.92 on Thurs after inking new agreement with CoreCivic Inc CXW.N on reactivation of immigrant detention center in Texas

      ** Woodlands, Texas firm early Thurs said it entered 5-yr lease and services agreement with private prison operator CXW to resume operations in Dilley

      ** Contract expected to provide at least $246 mln of rev over anticipated 5-yr term, TH said, of which ~$30 mln expected to be realized this year

      ** Similar to previous deal with CXW, the Dilley contract includes fixed minimum rev regardless of occupancy, TH said

      ** CXW shares last up nearly 4% on Thurs after news the U.S. Immigration and Customs Enforcement (ICE) to reopen the South Texas Family Residential Center (STFRC)

      ** On Feb 24, TH shares tumbled 46% after U.S. government terminated Pecos Children's Center services contract, prompting co to withdraw preliminary 2025 outlook

(Lance Tupper is a Reuters market analyst. The views expressed are his own)

((lance.tupper@tr.com 1-646-279-6380))