TPL

Texas Pacific Land ($TPL): Investors Watch Director and Major Shareholder's Steady Buying Amid Dramatic Stock Surge

04/09/2025 16:35

Texas Pacific Land Corp ($TPL) has seen a dramatic stock price surge over the past 12 months, accompanied by persistent insider buying activity. The stock, which traded around $580 in early June 2024, skyrocketed to over $1,700 in November 2024, and currently trades in the $1,100 range. Amid this remarkable ascent, consistent purchasing patterns from insiders, particularly board members and major shareholders, have drawn significant investor attention. Texas Pacific Land owns approximately 880,000 acres of land across 20 counties in West Texas, making it one of the largest private landowners in Texas. The company's primary revenue sources include oil and gas royalties (approximately two-thirds of income) and water services for hydraulic fracturing (around 30% of income), directly tied to oil and gas activities in the Permian Basin. For 2023, the company reported revenue of $631.6 million and net income of $405.6 million, maintaining an efficient operation with just 99 employees. The most notable insider trading pattern comes from director Murray Stahl, who has consistently purchased 10-12 shares almost daily since August 2024. These purchases were largely made pursuant to a Rule 10b5-1 plan (pre-planned stock trading plan) and continued despite the rising share price. Remarkably, Stahl maintained his buying pattern even as the stock price climbed from $800 to $1,400. Major shareholder Horizon Kinetics Asset Management LLC has shown a similar pattern, consistently purchasing small quantities of shares (typically 1-3) since June 2024. Horizon Kinetics is a significant investor, holding approximately 16% of $TPL, and interestingly, Murray Stahl has connections to Horizon Kinetics. Stahl directly owns 2,474 shares and has an indirect interest in approximately 53,550 shares through Horizon Kinetics. However, some top executives have taken selling positions. CFO Chris Steddum sold 350 shares for approximately $469,000 on November 14, 2024, and an additional 750 shares for over $973,000 on March 14, 2025. CAO Stephanie Buffington sold 210 shares for about $291,000 on November 12, 2024, while executive Micheal W. Dobbs sold 1,150 shares for $1.46 million on March 13, 2025. These executive sales appear to represent profit-taking as the stock approached all-time highs. $TPL was added to the S&P 500 index on November 26, 2024. While the stock fell 4.6% on its first trading day, closing at $1,539.27, it had already risen more than 300% year-to-date by that point. Inclusion in the S&P 500 typically attracts institutional investor interest and improves liquidity, potentially positively influencing the stock price over the medium to long term. The company's performance has remained robust. In Q2 2024, TPL reported adjusted earnings of $4.98 per share, up from $4.35 in the same period a year earlier, with revenue increasing 7.3% to $172.33 million. For Q3, the company posted net income of $106.6 million and revenue of $173.6 million. Additionally, on June 13, 2024, TPL announced a special dividend of $10 per share. Energy market volatility has also influenced $TPL's stock price. Since early 2025, the U.S. energy sector has experienced fluctuations due to economic concerns and changing supply-demand expectations. Mid-March saw energy companies decline due to recession fears, but by late March, they recovered due to crude oil inventory decreases and Venezuelan supply concerns. TPL's business model is directly affected by these energy market movements. Beyond traditional oil and gas royalties and water services, $TPL is exploring growth opportunities. The company is particularly investigating data center leasing on its vast landholdings. This strategy could help offset energy market volatility and diversify income streams. From an investor perspective, $TPL's insider trading patterns suggest strong confidence from management and the board in the company's long-term value. The continued buying by directors and major shareholders despite significant price increases is particularly noteworthy. However, sales by certain top executives and recent stock price volatility are factors that warrant short-term caution. The current correction phase following the rapid price increases of recent months can be viewed as natural, while the company's fundamental business model and asset value remain solid. The increased institutional investor interest from S&P 500 inclusion and the company's dividend policy are likely to be positive factors for medium to long-term investors. While energy market volatility and economic uncertainty may pose short-term challenges, the diverse revenue generation possibilities from TPL's extensive West Texas land assets provide promising long-term growth potential.

You can receive notifications when news is published.