The United States co-hosted a United Nations event last week to promote the fight against drugs. The opioid crisis claimed the lives of over 60,000 people in the U.S. last year, and over 8,000 in Canada since January 2016. The U.S. managed to lure signatories for its declaration which laid out a four-pronged strategy to combat drugs.
The Global Commission on Drug Policy was critical of the declaration. It drew attention to the "continuation of inefficient, costly, and harmful policies" which include “punitive law enforcement militarization, mass incarceration, forced treatment, and broken families and communities”. Canada lent its support to the declaration and was criticized by some voices at home.
In any case, a renewed crackdown will probably serve as a boost to some familiar equities that have performed well during the Trump era.
The GEO Group Inc. (NYSE:GEO) is a healthcare facility real estate investment trust. It operates multiple segments including U.S. Corrections and Detention, where it derives most its revenue. The stock is up 6.6% in 2018 so far. Shares reached an all-time high in the months following President Trump’s inauguration and a renewed focus on more draconian measures in the drug war could lead to more activity going forward.
Corecivic Inc. (NYSE:CXW) is another real estate investment trust involved in the ownership and operation of private prisons. Shares have climbed 8.1% in 2018 as of mid-afternoon trading on October 1. Both of these stocks are worth monitoring as this new policy will likely be fleshed out in the months to come.
