TPL

Despite 400% Stock Surge, Insiders Keep Buying: Texas Pacific Land ($TPL) Director and Major Shareholder Show Unwavering Conviction

04/03/2025 17:37

Insiders at Texas Pacific Land Corp ($TPL), one of Texas's largest landowners, have been demonstrating consistent buying patterns even during periods of significant stock price appreciation, capturing the attention of investors. Particularly notable is the persistent buying from director Murray Stahl and major shareholder Horizon Kinetics Asset Management (HKAM). $TPL owns approximately 880,000 acres of land in Texas, generating about two-thirds of its revenue from oil and gas royalties, with the remainder coming from water services for hydraulic fracturing operations. With a market capitalization of $32 billion, this large-cap company remarkably operates debt-free, boasting strong cash flow and a stable financial structure. According to insider trading data, Director Murray Stahl has consistently purchased 10-12 shares almost daily from August 2024 through April 2025. Notably, he continued buying even as the stock price surged from $800 to $1,700. His purchases follow a Rule 10b5-1 plan (pre-established trading schedule), demonstrating long-term investment conviction while complying with insider trading regulations. Major shareholder Horizon Kinetics Asset Management has also been steadily buying small quantities, typically 1-3 shares, from June 2024 through February 2025. According to the most recent disclosures, HKAM holds approximately 1,271,975 shares (about 16%), establishing itself as a significant influencer in the company. It's worth noting that Murray Stahl is connected to HKAM. According to SEC filing footnotes, while Stahl doesn't have direct investment discretion over $TPL shares held by HKAM, he has an indirect interest in approximately 53,550 shares. This suggests potential duplicate counting in some insider transactions. In contrast, several high-ranking executives sold portions of their holdings during price appreciation periods. CFO Chris Steddum sold 350 shares in November 2024 and 750 shares in March 2025, while CAO Stephanie Buffington sold 210 shares in November 2024. Additionally, officer Micheal Dobbs sold 1,150 shares (worth approximately $1.46 million) in March 2025. While these sales may represent personal asset management decisions, the timing near historical price highs suggests some insiders may have viewed the stock as temporarily overvalued. $TPL's stock traded around $580 in early June 2024 before suddenly jumping to $710 on June 10, then steadily climbing to break $1,000 in October 2024. It reached as high as $1,726 on November 22, 2024, before experiencing some correction and stabilizing in the $1,300-1,400 range by April 2025. This price appreciation likely reflects both consistent company growth and the catalyst of S&P 500 index inclusion in November 2024. Examining financial performance, the company reported $631.6 million in revenue for 2023, with operating income of $486.0 million and net income of $405.6 million. For Q3 2024, revenue reached $173.6 million with net income of $106.6 million. Particularly noteworthy is the company's healthy financial structure, with $369.8 million in cash and short-term investments while maintaining zero debt. $TPL is closely tied to the oil and gas industry, making it sensitive to energy price fluctuations. Recent news indicates oil companies experienced price increases following Trump's cancellation of Venezuela licenses, but also showed volatility due to recession concerns and supply-demand imbalances. Despite this energy market uncertainty, the consistent buying by insiders can be interpreted as a strong signal of confidence in the company's long-term value. The company is reportedly exploring opportunities for data center leases on its extensive land holdings, suggesting a strategy to diversify beyond its traditional energy royalty business and secure new growth drivers for the future. Overall, the consistent insider buying pattern represents a positive signal of strong insider confidence in the company's long-term value and growth potential, regardless of short-term price fluctuations. However, investors should note the selling by some top executives and energy market uncertainties as factors requiring attention. The future success of $TPL's business diversification efforts and energy market trends are expected to significantly impact the stock price going forward.

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