TXO

TXO Partners ($TXO) Insiders Snap Up 7.5% of Company Market Cap Following Stock Plunge

05/19/2025 14:31

In a striking display of confidence, insiders at TXO Partners LP ($TXO) have collectively purchased approximately $52.1 million worth of shares following a significant price drop triggered by the company's equity offering announcement. On May 13, 2025, TXO Partners announced a $175 million equity offering priced at $15 per unit, representing a 15.2% discount to its previous closing price. The proceeds are intended to fund a $475 million acquisition of oil, gas, and mineral assets from White Rock Energy in the Williston Basin of Montana and North Dakota. This news sent the stock plummeting over 16% in a single trading session. What followed, however, was remarkable. Between May 14-15, five TXO insiders purchased a combined 3.47 million shares worth $52.1 million, equivalent to approximately 7.5% of the company's $695 million market capitalization. Leading this buying spree was Director Bob Simpson, who single-handedly acquired 2.25 million shares for $33.75 million. Simpson is a veteran in the oil industry, having co-founded XTO Energy and served as its chairman until its acquisition by ExxonMobil for $41 billion in 2010. This isn't his first significant investment in $TXO; he previously purchased 100,000 shares for $2 million in June 2024. Director Keith Hutton also made a substantial investment, purchasing 700,000 shares for $10.5 million. Hutton, the former CEO of XTO Energy, has a long history alongside Simpson in the oil and gas industry. His recent purchase follows his December 2024 acquisitions totaling approximately $1.2 million across three separate transactions. Other notable purchases included Officer Luther King Jr. acquiring 500,000 shares ($7.5 million), Director Lawrence Massaro buying 20,000 shares ($300,000), and Director Phillip Kevil purchasing 3,000 shares ($45,540). This cluster of insider buying suggests strong conviction from management in the long-term value of the Williston Basin acquisition. The Williston Basin is a significant oil-producing region spanning Montana and North Dakota, and the acquisition is expected to substantially strengthen TXO's oil and gas portfolio. $TXO operates as an oil and gas royalty company, generating revenue through royalties on production assets. The company currently has approximately 41.2 million units outstanding and carries a strong buy rating from analysts with a median price target of $22.50, representing about 48% upside from current levels. The timing of these insider purchases is particularly noteworthy. Most transactions occurred at prices around $15, coinciding with the public offering price and approximately 21% below the $19 level the stock reached in mid-March 2025. The significant buying from Simpson and Hutton, both instrumental in the company's foundation, sends a powerful signal that they believe the current share price undervalues the company's prospects. Insider buying is generally considered a positive indicator of management's confidence in a company's future outlook. The magnitude of these purchases relative to TXO's market capitalization makes this case especially significant. Furthermore, the fact that oil and gas industry veterans are committing substantial personal capital provides additional reassurance to investors. While equity offerings typically pressure stock prices in the short term, the acquisition could enhance the company's long-term growth potential if successfully completed. The transaction is expected to close in the third quarter of 2025, and if it doesn't materialize, the raised capital will be directed toward debt repayment and general corporate purposes. $TXO shares have rebounded slightly to $15.20 as of May 16, 2025, following the insider purchases. As U.S. markets continue their upward trend amid optimism surrounding the U.S.-China tariff truce, investors will be watching closely to see if this insider confidence helps support a more sustained recovery in TXO's stock price.

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