CoreCivic Rises After Agreement To Resume Operations At Texas Migrant Detention Facility, Retail’s Bullish

CoreCivic (CXW) stock gained 7.1% in extended trading on Wednesday after it agreed to resume operations at a migrant detention facility in Texas.

The prison operator said it has signed an agreement with the U.S. Immigration and Customs Enforcement (ICE) to resume operations at the South Texas Family Residential Center in Dilley, Texas, which can house up to 2,400 people.

U.S. President Donald Trump has promised to implement the largest mass deportation of undocumented immigrants in U.S. history, a shift in policy that has benefited private prison operators.

The Dilley facility was purpose-built for ICE in 2014, and the company managed it from its construction through August 2024, when the Biden administration terminated funding for the contract with ICE and the facility was idled.

The company said the new agreement expires in March 2030 and may be extended through bilateral modification.

Once fully activated, CoreCivic expects the facility to generate total annual revenue of about $180 million, including medical services.

The Brentwood, Tennessee-based company started pre-activation activities at the facility earlier this year and expects the agreement to be accretive to earnings beginning in the second quarter.

"We are offering our staff the opportunity to transfer to the Dilley Facility and expect many who accept transfer opportunities will be professionals who previously provided services at the facility prior to its closure last year, expediting the activation process,” Chief Operating Officer Patrick Swindle said.

Retail sentiment on Stocktwits moved higher in the ‘bullish’ (63/100) territory than a day ago, while retail chatter remained ‘extremely low.’

Last week, the company had signed four new contract modifications with ICE to add capacity at its detention facilities.

CoreCivic also topped Wall Street’s estimates for quarterly profit and revenue earlier in February.

Over the past year, CoreCivic's shares have gained 27.5%.

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