Latest news with #TexasPacificLand
Yahoo
4 days ago
- Business
- Yahoo
Why Texas Pacific Land Stock Is Sinking Today
Key Points Texas Pacific Land grew sales and free cash flow by 9% and 12% in its latest quarter. These steady results occurred despite average oil prices being at low levels not seen since 2021. While its operating customers slowed activity in Q2, the company's CFO believes things are picking back up in the second half of the year. 10 stocks we like better than Texas Pacific Land › Shares of the largest landowner in the Permian Basin, Texas Pacific Land Corp. (NYSE: TPL), are down 8% as of 1 p.m. ET on Thursday, according to data provided by S&P Global Market Intelligence. Texas Pacific Land (TPL) grew sales and free cash flow by 9% and 12% during the second quarter, despite average oil prices sinking to a level not seen since 2021. Regardless of these steady results, the market sent the company's shares lower as it worried about the implications of Texas Pacific's water sales declining by 34% in Q2. Texas Pacific: A different kind of oil and gas company Home to nearly 900,000 acres across the Permian Basin, Texas Pacific generates sales through four high-margin business segments: Oil and gas royalties Water sales Produced water royalties Easements and other surface-related income In simplest terms, TPL generates income from the Exxons and Chevrons of the world as they drill and operate wells on its property. TPL leases the land, sells materials for construction, provides water for fracking, disposes of the produced water afterward, and earns royalties from oil and gas produced, creating revenue throughout the lifecycle of a well. Back to Q2, and it is the water sales portion of this process that spooked the market, as this segment's sales declined 34%. This drop stems from reduced activity from many of the company's operator customers who are more sensitive to these lower oil prices. However, Chief Financial Officer Chris Steddum explained that most of its customers have already resumed more typical activity early in the second half of the year. Ultimately, as the company explores next-generation ideas like carbon capture, solar, wind, grid-connected batteries, and water desalination, I'm happy to keep adding to my shares and watching TPL's story evolve. Should you buy stock in Texas Pacific Land right now? Before you buy stock in Texas Pacific Land, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Texas Pacific Land wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $635,544!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,099,758!* Now, it's worth noting Stock Advisor's total average return is 1,046% — a market-crushing outperformance compared to 181% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of August 4, 2025 Josh Kohn-Lindquist has positions in Texas Pacific Land. The Motley Fool has positions in and recommends Chevron. The Motley Fool has a disclosure policy. Why Texas Pacific Land Stock Is Sinking Today was originally published by The Motley Fool
Globe and Mail
5 days ago
- Business
- Globe and Mail
Why Texas Pacific Land Stock Is Sinking Today
Key Points Texas Pacific Land grew sales and free cash flow by 9% and 12% in its latest quarter. These steady results occurred despite average oil prices being at low levels not seen since 2021. While its operating customers slowed activity in Q2, the company's CFO believes things are picking back up in the second half of the year. 10 stocks we like better than Texas Pacific Land › Shares of the largest landowner in the Permian Basin, Texas Pacific Land Corp. (NYSE: TPL), are down 8% as of 1 p.m. ET on Thursday, according to data provided by S&P Global Market Intelligence. Texas Pacific Land (TPL) grew sales and free cash flow by 9% and 12% during the second quarter, despite average oil prices sinking to a level not seen since 2021. Regardless of these steady results, the market sent the company's shares lower as it worried about the implications of Texas Pacific's water sales declining by 34% in Q2. Texas Pacific: A different kind of oil and gas company Home to nearly 900,000 acres across the Permian Basin, Texas Pacific generates sales through four high-margin business segments: Oil and gas royalties Water sales Produced water royalties Easements and other surface-related income In simplest terms, TPL generates income from the Exxon s and Chevron s of the world as they drill and operate wells on its property. TPL leases the land, sells materials for construction, provides water for fracking, disposes of the produced water afterward, and earns royalties from oil and gas produced, creating revenue throughout the lifecycle of a well. Back to Q2, and it is the water sales portion of this process that spooked the market, as this segment's sales declined 34%. This drop stems from reduced activity from many of the company's operator customers who are more sensitive to these lower oil prices. However, Chief Financial Officer Chris Steddum explained that most of its customers have already resumed more typical activity early in the second half of the year. Ultimately, as the company explores next-generation ideas like carbon capture, solar, wind, grid-connected batteries, and water desalination, I'm happy to keep adding to my shares and watching TPL's story evolve. Should you invest $1,000 in Texas Pacific Land right now? Before you buy stock in Texas Pacific Land, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Texas Pacific Land wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $635,544!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,099,758!* Now, it's worth noting Stock Advisor's total average return is 1,046% — a market-crushing outperformance compared to 181% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of August 4, 2025
Yahoo
03-05-2025
- Business
- Yahoo
Texas Pacific Land's (NYSE:TPL) investors will be pleased with their enviable 732% return over the last five years
We think all investors should try to buy and hold high quality multi-year winners. While the best companies are hard to find, but they can generate massive returns over long periods. For example, the Texas Pacific Land Corporation (NYSE:TPL) share price is up a whopping 674% in the last half decade, a handsome return for long term holders. If that doesn't get you thinking about long term investing, we don't know what will. It really delights us to see such great share price performance for investors. So let's investigate and see if the longer term performance of the company has been in line with the underlying business' progress. Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit. In his essay The Superinvestors of Graham-and-Doddsville Warren Buffett described how share prices do not always rationally reflect the value of a business. By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time. Over half a decade, Texas Pacific Land managed to grow its earnings per share at 7.6% a year. This EPS growth is lower than the 51% average annual increase in the share price. This suggests that market participants hold the company in higher regard, these days. And that's hardly shocking given the track record of growth. This favorable sentiment is reflected in its (fairly optimistic) P/E ratio of 68.17. The image below shows how EPS has tracked over time (if you click on the image you can see greater detail). It's good to see that there was some significant insider buying in the last three months. That's a positive. That said, we think earnings and revenue growth trends are even more important factors to consider. Dive deeper into the earnings by checking this interactive graph of Texas Pacific Land's earnings, revenue and cash flow. As well as measuring the share price return, investors should also consider the total shareholder return (TSR). The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. Arguably, the TSR gives a more comprehensive picture of the return generated by a stock. We note that for Texas Pacific Land the TSR over the last 5 years was 732%, which is better than the share price return mentioned above. The dividends paid by the company have thusly boosted the total shareholder return. It's good to see that Texas Pacific Land has rewarded shareholders with a total shareholder return of 144% in the last twelve months. That's including the dividend. That gain is better than the annual TSR over five years, which is 53%. Therefore it seems like sentiment around the company has been positive lately. In the best case scenario, this may hint at some real business momentum, implying that now could be a great time to delve deeper. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. To that end, you should learn about the 2 warning signs we've spotted with Texas Pacific Land (including 1 which doesn't sit too well with us) . There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying. Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on American exchanges. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Sign in to access your portfolio
Yahoo
26-04-2025
- Business
- Yahoo
Why Texas Pacific Land Corporation (TPL) Is Up the Most So Far in 2025
We recently published a list of . In this article, we are going to take a look at where Texas Pacific Land Corporation (NYSE:TPL) stands against other energy stocks that are up the most so far in 2025. The energy sector has been volatile, and macro trends have led to fears of recession. The S&P 500 energy sector gained almost 9% from January till late March, but it has been dragged down by the broader market correction. Brent futures have hit lows and sent many energy stocks into a tailspin. Yet, there are still some energy stocks that have defied the odds and have delivered solid gains. Midstream companies have been exceptionally resilient, and renewables have also been a bright spot in the energy sector. Even during bear markets there are pockets of the market that perform exceptionally well. For instance, tech stocks have been in a bear market, but I recently identified in another article. For this article, I screened the best-performing energy stocks year-to-date. I will also mention the number of hedge fund investors in these stocks. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter's strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (). A pipeline running through a rural landscape, a reminder of the companies oil and gas Royalty Interest. Number of Hedge Fund Holders In Q4 2024: 28 Texas Pacific Land Corporation (NYSE:TPL) is one of the largest private landowners in Texas, generating revenue primarily from oil and gas royalties, water services, and land-related income streams in the Permian Basin. The most significant driver behind this surge has been a record-setting increase in oil and gas royalty production, which reached 28,300 barrels of oil equivalent per day in the third quarter of 2024, up 13% from the previous quarter. This led to a substantial boost in high-margin royalty revenue, which now makes up over half of the company's income. Texas Pacific Land (NYSE:TPL)'s asset-light model allows it to benefit from rising Permian Basin activity without the capital risks faced by traditional oil producers. The company's diversified revenue streams, including water sales and infrastructure easements, have also contributed to its resilience and growth. Investors have responded positively to TPL's ability to generate strong cash flow and earnings with minimal operational risk, especially as oil prices and drilling activity in West Texas picked up sharply in late 2024 and early 2025. The consensus price target of $917 implies 31.34% downside. TPL stock is up 20.46% year-to-date. Overall, TPL ranks 9th on our list of energy stocks that are up the most so far in 2025. While we acknowledge the potential of TPL, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than TPL but that trades at less than 5 times its earnings, check out our report about this . READ NEXT: and . Disclosure: None. This article is originally published at . Sign in to access your portfolio
Yahoo
04-04-2025
- Business
- Yahoo
This Hidden Gem Oil Stock More Than Doubled in a Year. Here's Why It's Still a Great Buy Now
Texas Pacific Land Corporation (NYSE: TPL) is up a staggering 142.8% over the past year, compared to a less than 10% return in the S&P 500 and a less than 2% gain in the energy sector. Here's why Texas Pacific Land, commonly known as TPL, has been such a strong-performing energy stock and why it still could be worth buying now. There are plenty of ways to invest in the energy sector. Integrated majors like ExxonMobil and Chevron have diverse operations across the oil and gas value chain and growing low-carbon businesses. Upstream companies like ConocoPhillips explore for and produce oil and gas, making them sensitive to lower oil prices. However, exploration and production companies can rake in the cash flow during periods of higher oil and gas prices. Midstream companies like Kinder Morgan build capital-intensive energy infrastructure assets, such as pipelines and terminals, that support the transportation and storage of hydrocarbons. Downstream companies like Valero Energy make products from refined fuels. TPL isn't like other oil and gas companies. It is one of the largest landowners in Texas, formed out of the bankruptcy of Pacific Railroad in the 19th century. TPL owns approximately 873,000 acres of land. That land didn't have a ton of value during the 19th century. The advent of horizontal drilling and hydraulic fracturing and the buildout of the oil and gas industry in West Texas and southern New Mexico have made TPL's land worth a fortune. TPL makes money from oil and gas royalties, water sales, easements, commercial leases, permits, and land sales. Its simple, low-risk business model is also capital-light because it doesn't drill for oil and gas. So, the company can still turn a tidy profit even when oil and gas prices are falling. The company's profits have exploded over the last decade as the Permian Basin -- right in TPL's backyard -- has become the largest onshore oil and gas production region in the U.S. TPL's water business has gotten much larger in recent years, achieving record sales in 2024. The company operates one of the largest water production, storage, and delivery networks in the Permian, which should continue growing as TPL has developed an energy-efficient method of produced water desalination and treatment. Water is used for drilling and completing wells and general on-site sanitary purposes. Given the harsh West Texas climate, supply is limited, making water a valuable asset. In 2024, oil and gas royalties were $373.3 million -- just 4.5% higher than 2023. But water sales and produced water royalties combined for $254.8 million, up over 30% year over year. As you can see in the following chart, TPL has been steadily growing sales, operating income, and earnings, and it still turned a solid profit during the COVID-19-induced oil and gas crash. The buildout of the water business has taken earnings to the next level, and TPL directly passes along some of those profits to shareholders through dividends. In 2021, TPL began paying a regular quarterly dividend, which has grown substantially in recent years to $1.62 per share. TPL will also pay extra dividends depending on the business' performance. Special dividends provide an added incentive to hold the stock. But even when factoring in special dividends, TPL doesn't yield nearly as much as other oil and gas stocks. In 2024, TPL paid a record $13.51 per share in dividends -- but that is a yield of just 1% based on the stock price at the time of this writing. So investors interested in generating reliable and sizable passive income may want to consider other oil and gas stocks instead. TPL's low operating expenses allow it to convert the majority of revenue into net income, making TPL a highly profitable business. But because the stock has done so well, TPL's valuation has ballooned to 69 times trailing earnings. That is a very expensive price to pay, even for a high-quality business. TPL has been a red-hot stock, stretching the valuation and compressing the yield. However, the company could remain a steady performer and grow into its valuation in time. TPL benefits from higher Permian oil and gas production and water demand. This isn't always true for exploration and production companies, which may boost production but generate lower margins if oil prices fall. TPL isn't as attractive a buy as it used to be, because the valuation has gotten so pricey. Still, it has arguably one of the best business models out there, especially when factoring in how much larger the water business is today than it was just a few years ago. Ever feel like you missed the boat in buying the most successful stocks? Then you'll want to hear this. On rare occasions, our expert team of analysts issues a 'Double Down' stock recommendation for companies that they think are about to pop. If you're worried you've already missed your chance to invest, now is the best time to buy before it's too late. And the numbers speak for themselves: Nvidia: if you invested $1,000 when we doubled down in 2009, you'd have $285,647!* Apple: if you invested $1,000 when we doubled down in 2008, you'd have $42,315!* Netflix: if you invested $1,000 when we doubled down in 2004, you'd have $500,667!* Right now, we're issuing 'Double Down' alerts for three incredible companies, and there may not be another chance like this anytime soon.*Stock Advisor returns as of April 1, 2025 Daniel Foelber has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Chevron and Kinder Morgan. The Motley Fool has a disclosure policy. This Hidden Gem Oil Stock More Than Doubled in a Year. Here's Why It's Still a Great Buy Now was originally published by The Motley Fool Sign in to access your portfolio
