Private prisons, crypto stocks outpacing even Tesla after Trump’s win

On By Littum

Upper line

Tesla may be the highest-profile stock market winner over the past week, but there are several stocks that have outperformed the Elon Musk-led auto company thanks to similar optimism about macro conditions under the incoming administration.

Key facts

Tesla stock’s 39% gain from last Tuesday’s close through Monday’s is by far the biggest of any of the 101 U.S. public companies valued at $100 billion or more, more than double the 18% gain of the next best performer of that bunch, software defense contractor Palantir.

But other smaller companies have outperformed Tesla since Donald Trump secured a second term as president, several of which are law enforcement-related areas that could benefit from Trump’s border controls and tough-on-crime agendas.

The only S&P 500 company to top Tesla is the Taser stun gun maker Axon Enterprise of 40%, while shares in multi-billion dollar private prison companies CoreCivic and Geo Group— which are Immigration and Customs Enforcement — are up 76% and 75%, respectively, since Election Day.

And a number of cryptocurrency-related stocks have rallied over the past week, with the world’s biggest digital asset surging to a record above $86,000 as traders reacted to Trump’s embrace of the industry on the campaign trail.

Crypto exchange Coin base shares are up 67% since last Tuesday and Micro strategya 35-year-old enterprise software company most notable for its roughly $25 billion in bitcoin holdings has posted a 49% gain, while crypto-leaning retail investor platform Robinhood shares are up 31%, trailing Tesla.

Bitcoin mining stocks have similarly risen as the companies involved in the energy-intensive process of unlocking bitcoin on the digital blockchain have received a double boost from a surge in crypto interest and hope for relaxation of the rules on industry shares of CleanSpark, Riot platforms and Digital Marathon have increased by 67%, 54% and 54% respectively.

Why private prison stocks are rising so much

Increase of CoreCivic and Geo Group shares further On Monday, Trump’s appointment of Tom Homan as his “border czar,” with the former acting ICE director one advocate of a “humane” but “necessary mass deportation operation.” In a conference call last Thursday, Geo Group Chairman George Zoley said he expects the government to fund 70,000 to 100,000 beds in ICE detention centers, roughly double the 41,500 beds now funded. Geo Group could increase its operational ICE detention centers from 13,000 to 31,000 by next year, predicts Brendan McCarthy, an analyst at independent research firm Sidoti. McCarthy projects $3 billion in revenue for Geo Group by 2025, a 24% jump from its mixed 2024 sales.

Key background

US stocks are up almost across the board since the election, with the Dow Jones Industrial Average up 5% and the small-cap Russell 2000 up 8% since last Tuesday. There are several tailwinds to this broad rally, but the potential for lower corporate tax rates and an expected increase in merger and acquisition activity in the looming Trump administration are among the main drivers of the financial market rally. Bernstein analyst Gautam Chhugani, who correctly predicted last week that bitcoin would rise above $80,000 if Trump won, called his weekly note to clients “Welcome to the crypto bull market – Buy all you can,” reflecting the almost euphoric attitude that prevails among crypto. investors.

Further reading

ForbesWhat to know about Trump’s new ‘Border Czar’ Tom HomanBy Mary Whitfill Roeloffs