Corrections Corp. (ticker: CXW), for example, at its recent price around $25, was trading at about 24 times its estimated earnings for this year of $1.04 a share, well above the 20.5 of the S&P 500. The company's earnings, however, look to be growing around 20% annually, helping to justify the price. If the shares keep their current P/E, the price could jump to $30.

GEO (GEO), which was hurt Friday by the announcement that it is losing a contract in Texas, trades at 26 times estimated earnings for this year. But its CEO sees no impact on this year's earnings from the Texas decision. Indeed, net could well rise by more than 25%, to $1.36 a share, perhaps lifting the shares to $35 from the high 20s.

Cornell (CRN), whose earnings estimates were cut this year after it lost a federal contract for the incarceration of illegal immigrants at one of it's Arizona prisons, also looks pricey at first glance, trading at 30.5 times 2007 earnings estimates. But analysts say that earnings could rebound next year to $1.27 a share from an estimated 82 cents this year, sending the stock up by 40% or more. Returns like that seem almost, well, illegal.