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TPL

Texas Pacific Land Corp($TPL) Shows Contrasting Insider Patterns: Directors Buy Steadily While Executives Sell Strategically

04/16/2025 17:18

Sentiment

Serial Buy

Summary

  • Texas Pacific Land Corp ($TPL) director Murray Stahl and major shareholder Horizon Kinetics have maintained consistent buying patterns regardless of stock price fluctuations.
  • In contrast, several executives chose to sell at price peaks, with notable sales by the CFO and other officers in November 2024 and March 2025.
  • With over $705 million in revenue and a profit margin exceeding 64%, TPL demonstrates exceptional financial health, being virtually debt-free and holding over $369 million in cash.

POSITIVE

  • Consistent buying by directors and major shareholders indicates insider confidence in the company's long-term outlook.
  • High profit margin of 64.32% and near-zero debt ratio (0.002%) demonstrate exceptional financial health.
  • Vast land ownership in the Permian Basin provides opportunities for revenue diversification beyond oil and gas royalties, such as data center leases.
  • Inclusion in the S&P 500 is expected to enhance market visibility and liquidity for the company.

NEGATIVE

  • Sales by several high-ranking executives may reflect concerns about short-term price declines.
  • Volatility in energy prices could impact royalty income.
  • High valuation multiples such as P/E ratio of 64.93 present downside risk if growth slows.
  • Changes in U.S. energy policy and global uncertainties pose industry-wide risk factors.

Expert

Within the energy sector, Texas Pacific Land Corp differentiates itself with a unique business model. Its vast land assets and royalty-based revenue model provide more stable income streams than typical energy companies, while minimal debt and high profit margins serve as recession buffers. The consistent buying pattern by insiders signals strong confidence in long-term value, though selective selling by executives suggests potential for short-term price adjustments.

Previous Closing Price

$1.35K

-15.05(1.10%)

Average Insider Trading Data Over the Past Year

$1.13K

Purchase Average Price

$1.29K

Sale Average Price

$2.1M

Purchase Amount

$3.54M

Sale Amount

Transaction related to News

Trading Date

Filing Date

Insider

Title

Type

Avg. Price

Trans. Value

05/22/2025

05/22/2025

Sale

$

Recent insider trading patterns at Texas Pacific Land Corp ($TPL) have drawn significant attention. The company stands as one of America's largest landowners, with vast acreage in the oil-rich Permian Basin, giving it a unique position within the energy sector. TPL's stock has seen dramatic movement over the past 12 months. Starting from around $580 in June 2024, it surged to over $1,700 by November 2024, before experiencing volatility and settling near $1,250 currently. The company gained particular attention when it was added to the S&P 500 index in November 2024, though paradoxically fell 4.6% on its first day of inclusion. Amid these price fluctuations, a striking pattern emerges from the consistent buying by director Murray Stahl and major shareholder Horizon Kinetics Asset Management LLC. Both insiders have maintained steady purchasing programs regardless of price increases or decreases. Director Murray Stahl has been purchasing 10-12 shares almost daily since August 2024. These purchases, executed according to a Rule 10b5-1 plan, occurred at various price points ranging from $816 in August 2024 to around $1,250 in April 2025. Notably, this buying pattern continued uninterrupted even when the stock hit all-time highs in November 2024. Similarly, Horizon Kinetics, which owns approximately 16% of TPL, has consistently acquired small amounts (typically 1-3 shares) since June 2024. According to amended Schedule 13D filings, Horizon Kinetics currently holds about 1,271,975 shares, and while Murray Stahl is associated with the firm, he reportedly does not participate directly in investment decisions regarding TPL securities. In contrast to these steady buying patterns, several high-ranking executives chose strategic selling points. In November 2024, when the stock approached historic highs, Stephanie Buffington (CAO) and Chris Steddum (CFO) sold 210 and 350 shares, respectively. More recently, in March 2025, CFO Steddum sold an additional 750 shares, while officer Micheal W Dobbs divested 1,150 shares. These sales coincided with the beginning of the stock's weakening performance. Another interesting transaction occurred in February 2025, when director Donna E Epps sold 275 shares and then repurchased the same amount at a similar price on the same day, likely for tax-related reasons or portfolio rebalancing. To understand these insider trading patterns in broader context, it's essential to examine TPL's business model and financial situation. The company isn't a traditional oil and gas company but a landowner with diverse revenue streams including royalty income, easement grants, and water services. Recent financial results show annual revenue of approximately $705.82 million and net income of $453.96 million, representing an impressive profit margin of 64.32%. Even more remarkable is TPL's financial health. The company is virtually debt-free (total debt of $1.25 million, debt ratio of 0.002%) and holds over $369 million in cash. Its high current ratio of 10.81 indicates the company has ample ability to meet short-term obligations. This robust financial structure provides a significant competitive advantage in the volatile energy sector. In an industry context, TPL benefits from energy booms without many of the operational risks faced by traditional oil and gas companies. Recent news indicates the company is exploring new opportunities like data center leases utilizing its extensive land holdings, beyond oil and gas royalties and water sales. As the U.S. navigates potential recession concerns and inflationary pressures, the energy sector experienced volatility in early 2025. In early April, the U.S. stock market saw significant volatility due to trade tensions and tariff announcements. During such uncertain times, insider trading patterns are often interpreted as signals of confidence in the company's long-term outlook. In summary, TPL's insider trading patterns show an interesting contrast: on one hand, company directors and major shareholders steadily purchasing shares, expressing long-term confidence, and on the other, select executives realizing profits by selling portions of their holdings at elevated price points. This pattern, coupled with the company's strong financial position, suggests that despite short-term volatility, TPL remains a solid long-term investment proposition.

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