TPL

Texas Pacific Land ($TPL) Insiders Keep Buying Through 111% Surge and 22% Crash - A Signal of Long-Term Value?

05/12/2025 15:19

Texas Pacific Land ($TPL) has seen persistent insider buying even amidst significant stock volatility, with shares surging over 111% in the past year, capturing the attention of market observers. Over the last 12 months, $TPL stock has experienced a roller-coaster ride, climbing from around $580 in June 2024 to a peak of $1,726 in November, before temporarily plunging to $1,079 in early April 2025 and recovering to current levels around $1,301. Despite these substantial price swings, director Murray Stahl and major shareholder Horizon Kinetics Asset Management LLC have maintained remarkably consistent buying patterns. Particularly noteworthy is director Murray Stahl's persistent acquisition of 10-12 shares almost daily from August 2024 through May 2025. He continued buying even when the stock reached its all-time high in mid-November 2024, paying over $1,400 per share, and maintained his pattern when the stock plummeted 22% in a single day in early April 2025. Most of these transactions were executed under Rule 10b5-1 plans adopted in May and November 2024, demonstrating pre-planned purchases rather than opportunistic trading on inside information. Horizon Kinetics has displayed a similar pattern, consistently purchasing small quantities of 1-3 shares from June 2024 through February 2025. As a major shareholder owning approximately 16% of $TPL, the firm's actions send important signals to the market. Texas Pacific Land is a land and resource management company that owns approximately 873,000 surface acres and 207,000 net royalty acres in the Permian Basin of Texas. The company generates revenue primarily through oil and gas royalties, easements, commercial leases, and land sales, while also providing water services to operators in the region. According to Q1 2025 financial results, $TPL reported revenue of $196 million (up 13% year-over-year) and net income of $120.7 million (up 5.4% from the previous year). This translates to earnings per share (EPS) of $5.25, an improvement from $4.97 in the same period last year. However, the profit margin slightly decreased from 66% to 62% due to increased operational expenses. In November 2024, the company achieved a significant milestone by being added to the S&P 500 index, although the stock paradoxically fell 4.6% on its first day of inclusion on November 26. Nevertheless, the company continues to demonstrate robust financial performance with a return on equity (ROE) of 39.52% and a profit margin of 63.24%, substantially outperforming industry averages. However, the stock's price-to-earnings (P/E) ratio stands at a relatively high 64.94, and recent declines in oil prices impacted the company's Q1 2025 adjusted core profit, which fell short of Wall Street expectations. Oil prices decreased 7.5% year-over-year to $71.05 per barrel, affecting royalty income, though this was partially offset by increased production and higher natural gas prices. Analysts currently maintain a "BUY" rating on $TPL with price targets ranging from $1,376 to $1,468. Despite the stock's continued volatility, the persistent buying by key insiders suggests strong internal confidence in the company's long-term value proposition. Murray Stahl, a well-known value investor in the financial industry who also serves as Chairman and CEO of Horizon Kinetics, has demonstrated through his consistent purchases that he's focused on the fundamental asset value and long-term growth potential rather than short-term price fluctuations. Looking ahead, $TPL's stock direction will likely be influenced by movements in oil and gas prices, production activity in the Permian Basin, and the success of new business opportunities such as the recently discussed data center site leasing. However, the steady pattern of insider buying serves as a powerful signal that long-term value may still be found at current valuation levels.

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