Corrections Corporation of America is rebranding, but officials say they're not abandoning the company's core business.
Despite heightened criticism of for-profit prison operators, leaders of the Nashville-based firm say they're as enthusiastic as ever.
"There has been an overreaction in the market to the long-term viability of our business," CEO Damon Hininger said Thursday in a call with analysts. "It reflects a fundamental misunderstanding in these market dynamics."
Hininger blames the misunderstanding on CCA's critics. He says they've seized on news like the U.S. Bureau of Prison's recent announcement it plans to end the use of private prisons.
It was just last week that CCA announced it's changing its name to CoreCivic. References to prisons and inmates are conspicuously absent from the new moniker. But Hininger tells analysts that shouldn't be seen as a sign the company's getting away from that business.
CCA says the shift on federal prisons ultimately won't hurt its bottom line. The company also sees new opportunities in places where prisons are overcrowded and CCA has open beds.
Even CCA's decision to move into real estate services may have ties to prisons.
CoreCivic Properties will pursue a wide range of government contracts. But company officials also foresee the new division contracting with local sheriffs and state prison systems to help them build, design, finance and maintain prisons — though not staff them with correctional officers.
And Hininger says he's not just trying to put a positive spin on the news. He tells analysts that he's been increasing his personal holdings in the company and now holds twice as much stock as he's contractually required to own.
That's even though CCA's stock has been trading at some of the lowest levels of his seven years in charge.