By M. Marin
NYSE:CXW
READ THE FULL CXW RESEARCH REPORT
Key takeaways as CXW wins multiple new contracts
CoreCivic (NYSE:CXW) has recently announced multiple new contract awards. The expected aggregate annual incremental revenue from contracts signed in 3Q25 alone to reactivate formerly idled facilities is about $325 million. Our takeaways include:
- New contract awards are expected to boost incremental revenue, utilization and operating leverage.
- Recent contracts set the stage for a strong 2026.
- We believe CXW’s momentum supports our view that the company’s relationship with its customers is strong.
- New awards also highlight that CXW’s facilities are relatively new compared to government facilities and it has a long history of providing capacity and other services to its government partners.
- While ICE is CXW’s largest government partner, demand from states and counties has been strong and CXW anticipates further near term opportunities with these entities.
- Reflecting its strong balance sheet and liquidity, the company remains well positioned during the government shutdown and is entitled to receive full payment and interest payments once the shutdown ends.
Year-to-date, CXW has announced multiple new contract awards, expansions and/or reactivations. Thus, CXW is in the process of reactivating multiple idled facilities. Last week CXW announced the award of a new contract effective September 30, 2025, under an Intergovernmental Services Agreement (IGSA) between the Oklahoma Department of Corrections and ICE to restart operations at its 2,160-bed Diamondback Correctional Facility, which has been idle since 2010. The new contract is for a term of at least five years and provides for a fixed monthly payment plus an incremental per diem payment based on populations. Once the facility is fully activated – which is expected by 2Q26 -- total annual revenue is expected to be roughly $100 million.
CXW also recently transitioned from a Letter Contract with ICE to a new formal contract for the 2,560-bed California City Immigration Processing Center and the South Texas Family Residential Center in Dilley. The company has also entered into a new lease agreement with Target Hospitality Corporation, which owns the Dilley facility.
CXW also recently transitioned from a Letter Contract with ICE to a new formal contract for the 1,033-bed Midwest Regional Reception Center, although activities have been paused by a lawsuit the City of Leavenworth has filed. The Department of Justice (DOJ) filed a Statement of Interest last month in support of CXW’s position. If/when the suit is resolved, the agreement provides for a fixed monthly payment plus an incremental per diem payment based on detainee populations and annual revenue once the center is fully ramped is expected to be about $60 million.
In addition, CXW recently announced that it has been awarded a new contract under an intergovernmental services agreement (IGSA) between the City of Mason, Tennessee, and ICE (U.S. Immigration and Customs Enforcement) to resume operations at its West Tennessee Detention Facility through August 2030 with an option to extend.
CXW has a strong balance sheet and liquidity during government shutdown
Separately, With $130.5 million of cash at the end of 2Q25 and $216.4 million available under its revolver, for liquidity of about $346.9 million, CXW has a strong balance sheet and liquidity to support operations during the government shutdown. Moreover, the company expects to receive full payment and interest payments once the shutdown ends. During government shutdowns and in most situations when an agency pays late, the agency is required to pay interest under the 1982 Prompt Payment Act.
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