Target Hospitality (NASDAQ:TH) saw its stock drop significantly, falling 30% in after-hours trading, following news that the Biden administration intends to shut down the Dilley detention center in Dilley, Texas. The stock had already decreased by 6% during regular trading hours.
Key Points:
- Closure Plans: The Biden administration plans to close the Dilley detention center this summer. This facility is more expensive to run compared to other Immigration and Customs Enforcement (ICE) centers.
- Report Source: This information came from a Wall Street Journal report citing ICE officials.
- Target Hospitality’s Involvement: Target Hospitality provides services like hospitality and culinary services at the Dilley center. This center is the largest facility for Target Hospitality, with over 2,500 beds.
- Financial Impact: Last year, more than 72% of Target Hospitality’s revenue came from its government segment, which includes the Dilley center.
- Stock Impact: After the news about the center’s closure, Target Hospitality’s stock fell sharply.
- Recent Developments: This drop follows a recent 25% increase in the company’s stock on March 25, when Arrow Holdings made an offer to buy Target Hospitality for $10.80 per share. In late April, Target announced that it had formed a special committee to evaluate this takeover offer.
- No Immediate Comment: Target Hospitality did not immediately respond to Seeking Alpha’s request for comments on the matter.
About Target Hospitality
Target Hospitality‘s mission is to assist global partners in achieving their maximum potential. They believe that individuals who are well-nourished, well-rested, and work in clean, safe environments are more productive, which ultimately benefits the organization.
Their goal is to transform the workforce into an extremely productive team, akin to rocket-propelled superhumans. This mission is grounded in core values such as safety, care, excellence, integrity, and collaboration.
Established in 1978, the company builds, owns, and operates customized facilities for a variety of end-users. They are recognized as the largest specialty rental and hospitality services company in the United States, providing comprehensive and cost-effective hospitality solutions. These services include culinary and catering, concierge, laundry, recreational facilities, transportation, and security.
With an extensive network of relocatable rental accommodation units across the United States, featuring approximately 16,000 rooms across 31 unique sites, they offer top-tier solutions for Fortune 500 companies, governments, and NGOs.
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