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Texas Pacific Land Corporation (TPL)
:TPL
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Texas Pacific Land
(NYSE:TPL)
Select Model
Select Model
Rating:75Outperform
Price Target:
$1,017.00
▲(17.86% Upside)
Texas Pacific Land's strong financial performance and strategic growth initiatives are the primary drivers of its stock score. The company's robust earnings call and positive corporate events further support its potential for long-term growth. However, the high P/E ratio and bearish technical indicators suggest caution, as the stock may be overvalued and lacking strong momentum.
Positive Factors
Revenue Growth
Record revenue growth indicates strong demand and effective business strategies, enhancing long-term financial stability and market position.
Strategic Acquisitions
Strategic acquisitions expand resource base and revenue potential, positioning TPL for sustained growth and competitive advantage in the oil and gas sector.
Balance Sheet Health
A strong balance sheet with minimal debt enhances financial flexibility and resilience, supporting long-term strategic initiatives and shareholder value.
Negative Factors
Commodity Price Challenges
Low commodity prices can impact revenue from oil and gas royalties, posing a risk to profitability and cash flow stability in the long term.
Volatility in Water Sales
Volatility in water sales can lead to unpredictable revenue streams, challenging consistent growth and operational planning.
High Valuation Concerns
High valuation may limit stock price appreciation and attract scrutiny, potentially impacting investor sentiment and long-term investment attractiveness.
Texas Pacific Land (TPL) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$21.14B
Dividend Yield0.76%
Average Volume (3M)119.63K
Price to Earnings (P/E)44.2
Beta (1Y)1.30
Revenue Growth12.48%
EPS Growth6.24%
CountryUS
Employees111
SectorEnergy
Sector Strength52
IndustryOil & Gas Exploration & Production
Share Statistics
EPS (TTM)5.27
Shares Outstanding22,979,410
10 Day Avg. Volume120,984
30 Day Avg. Volume119,631
Financial Highlights & Ratios
PEG Ratio4.58
Price to Book (P/B)22.45
Price to Sales (P/S)36.02
P/FCF Ratio55.15
Enterprise Value/Market Cap0.99
Enterprise Value/Revenue27.05
Enterprise Value/Gross Profit30.94
Enterprise Value/Ebitda32.47
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Texas Pacific Land Business Overview & Revenue Model
Company DescriptionTexas Pacific Land (TPL) is a publicly traded land and resource management company based in Texas, primarily engaged in the ownership and management of land and mineral interests. The company operates in the oil and gas sector, focusing on the leasing of its land for exploration and drilling activities. TPL's core offerings include leasing its extensive land holdings to energy companies, managing surface land for various uses, and generating income from royalties on oil and gas production.
How the Company Makes MoneyTexas Pacific Land generates revenue through multiple key streams. Primarily, it earns money by leasing its land to oil and gas companies, who pay for the right to explore and extract resources. The company receives lease bonuses, which are upfront payments made by lessees, and ongoing royalties based on the volume of oil and gas produced from its properties. Additionally, TPL earns revenue from surface use agreements, allowing companies to use the land for activities related to energy extraction, such as drilling sites and pipelines. The company's significant land holdings in resource-rich areas, particularly in the Permian Basin, enhance its revenue potential. Furthermore, TPL may engage in partnerships with exploration and production companies, leveraging its land assets to foster profitable arrangements that contribute to its earnings.
Texas Pacific Land Earnings Call Summary
Earnings Call Date:Nov 05, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Feb 25, 2026
Earnings Call Sentiment Positive
The earnings call highlighted TPL's record-setting financial performance, strategic acquisitions, and robust growth in both oil and gas and water segments despite facing challenges from weak commodity prices. The company's strong liquidity position and strategic asset acquisitions reflect a focus on long-term growth and shareholder returns.Q3-2025 Updates
Positive Updates
Record Revenue and Volume Performance
TPL achieved over $200 million in revenue for the first time in its history, with significant growth in oil and gas royalty production (28% year-over-year increase) and water sales (23% growth year-over-year).
Significant Royalty Acquisition
TPL acquired approximately 17,300 net royalty acres for $474 million, expected to yield a double-digit pretax cash flow at $60 per barrel of oil and $2 per 1,000 cubic feet of natural gas.
Strong Free Cash Flow and EBITDA
TPL reported $123 million in free cash flow, a 15% increase year-over-year, with an adjusted EBITDA margin of 85%.
Water Segment Growth
Water sales revenue hit a record $45 million, with produced water royalty revenues increasing by 16% year-over-year.
Credit Facility Enhancing Liquidity
TPL closed on a $500 million credit facility to fund growth opportunities, with attractive interest rates, enhancing liquidity.
Negative Updates
Commodity Price Challenges
TPL faced some of the weakest benchmark oil and gas prices since the COVID pandemic, impacting oil and gas royalty revenues.
Volatility in Water Sales
There was noted volatility in water sales over the last two quarters, attributed to consolidation and diverse acreage positions.
Company Guidance
In the third quarter of 2025, Texas Pacific Land Corporation reported a record performance across several key metrics. Oil and gas royalty production reached approximately 36,300 barrels of oil equivalent per day, marking a 9% sequential increase and a 28% increase year-over-year. Water sales achieved a record $45 million, reflecting a 74% sequential growth and a 23% increase year-over-year. Produced water royalty revenues also hit a record $32 million, with a 5% sequential growth and a 16% increase year-over-year. Overall, the company reported over $200 million in revenue for the first time in its history, despite facing some of the weakest oil and gas prices since the COVID pandemic. The company's growth was fueled by increased production volumes in its Northern Culberson, Northern Reeves, and Central Midland subregions, as well as an expansion of its lateral lengths. Texas Pacific Land Corporation also highlighted a significant acquisition of approximately 17,300 net royalty acres in the Midland Basin, funded by $474 million in cash, which is expected to generate a double-digit pretax cash flow yield. The company's water services segment rebounded significantly, with investments in brackish and treated water infrastructure contributing to its competitive advantage. The organization's strategic focus on long-term value creation and opportunistic consolidation of high-quality Permian assets positions it well for future growth and shareholder returns.Texas Pacific Land Financial Statement Overview
Summary
Texas Pacific Land demonstrates strong financial health with excellent profitability, robust growth, and a solid balance sheet. The company maintains minimal debt levels, high equity, and strong cash flows, positioning it well within the fossil fuels industry. Potential risks include volatility in revenue due to industry fluctuations, but current financial metrics show resilience.Income Statement
Texas Pacific Land has shown strong revenue growth from $631.6 million in 2023 to $705.8 million in 2024, a growth rate of 11.8%. The gross profit margin is excellent at 100%, indicating effective cost management. The net profit margin is robust at 64.3%, showing strong profitability. EBIT and EBITDA margins are also high at 76.4% and 85.6% respectively, showcasing strong operational efficiency.87
Very Positive
Balance Sheet
The company's balance sheet is notably strong with a debt-to-equity ratio of practically zero due to minimal debt. Return on equity is impressive at 40.1%, reflecting efficient use of shareholder funds. The equity ratio is high at 90.7%, suggesting a stable financial foundation with a low level of liabilities.92
Very Positive
Cash Flow
The free cash flow growth rate is substantial at 21.8%, indicating improved cash generation. The operating cash flow to net income ratio is 1.08, showing healthy cash flow relative to earnings. The free cash flow to net income ratio is 1.02, demonstrating efficient conversion of profits into cash.85
Very Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 772.39M | 705.82M | 631.60M | 667.42M | 450.96M | 302.55M |
| Gross Profit | 675.39M | 634.54M | 583.27M | 634.53M | 421.47M | 269.95M |
| EBITDA | 643.62M | 564.30M | 500.81M | 577.68M | 378.65M | 231.66M |
| Net Income | 476.39M | 453.96M | 405.64M | 446.36M | 269.98M | 176.05M |
Balance Sheet | ||||||
| Total Assets | 1.52B | 1.25B | 1.16B | 877.43M | 764.06M | 571.63M |
| Cash, Cash Equivalents and Short-Term Investments | 531.81M | 369.83M | 725.17M | 510.83M | 428.24M | 281.05M |
| Total Debt | 16.51M | 453.00K | 1.17M | 1.96M | 1.45M | 2.03M |
| Total Liabilities | 156.95M | 115.56M | 113.20M | 104.54M | 112.35M | 86.45M |
| Stockholders Equity | 1.37B | 1.13B | 1.04B | 772.89M | 651.71M | 485.18M |
Cash Flow | ||||||
| Free Cash Flow | 514.69M | 460.98M | 403.26M | 427.94M | 249.62M | 201.95M |
| Operating Cash Flow | 558.81M | 490.67M | 418.29M | 447.15M | 265.16M | 207.04M |
| Investing Cash Flow | -383.59M | -471.75M | -60.31M | -21.40M | -15.00M | -26.00M |
| Financing Cash Flow | -177.33M | -378.09M | -144.61M | -336.81M | -104.95M | -201.66M |
Texas Pacific Land Technical Analysis
Negative
862.91
Price Trends
922.63
Negative
921.08
Negative
1067.03
Negative
Market Momentum
-14.89
Positive
36.89
Neutral
32.68
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TPL, the sentiment is Negative. The current price of 862.91 is below the 20-day moving average (MA) of 896.10, below the 50-day MA of 922.63, and below the 200-day MA of 1067.03, indicating a bearish trend. The MACD of -14.89 indicates Positive momentum. The RSI at 36.89 is Neutral, neither overbought nor oversold. The STOCH value of 32.68 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TPL.
Texas Pacific Land Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $12.12B | 13.34 | 8.58% | 4.11% | 7.55% | -34.40% | |
79 Outperform | $23.54B | 8.82 | 18.35% | 2.56% | 11.14% | -21.32% | |
75 Outperform | $21.14B | 44.18 | 39.37% | 0.76% | 12.48% | 6.24% | |
73 Outperform | $20.00B | 12.12 | 11.86% | 3.35% | 26.13% | 31.42% | |
70 Neutral | $10.22B | 44.20 | 2.26% | 2.97% | -8.07% | -87.88% | |
67 Neutral | $10.86B | 20.15 | 7.65% | ― | 17.05% | 1028.81% | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% |
* Energy Sector Average
TPL
Texas Pacific Land
838.64
-369.87
-30.61%
CTRA
Coterra Energy
26.27
2.38
9.96%
DVN
Devon Energy
37.52
5.61
17.58%
OVV
Ovintiv
40.34
1.45
3.73%
AR
Antero Resources
35.19
3.61
11.43%
PR
Permian Resources
14.60
0.90
6.57%
Texas Pacific Land Corporate Events
Stock Split
Texas Pacific Land Announces Forward Stock Split
Neutral
Dec 2, 2025
On November 5, 2025, Texas Pacific Land Corporation announced a three-for-one forward stock split of its common stock, which will become effective on December 22, 2025. This move is expected to increase the number of authorized shares significantly, with trading on a split-adjusted basis commencing on December 23, 2025, potentially impacting the company’s market positioning and shareholder value.
Executive/Board ChangesShareholder Meetings
Texas Pacific Land Holds Annual Stockholders Meeting
Neutral
Nov 12, 2025
On November 6, 2025, Texas Pacific Land Corporation conducted its Annual Meeting of Stockholders, where 18,923,012 shares were represented. The meeting included the election of nine board members, approval of executive compensation, ratification of Deloitte & Touche LLP as the accounting firm, and consideration of a proposal to lower the ownership threshold for calling special meetings. The proposal to reduce the ownership threshold was not approved, while other proposals were successfully passed.
Private Placements and FinancingBusiness Operations and StrategyFinancial Disclosures
Texas Pacific Land Reports Record Quarterly Revenues
Positive
Nov 5, 2025
On November 5, 2025, Texas Pacific Land Corporation announced record quarterly revenues and net income for its Water Services and Operations segment, highlighting strategic acquisitions and operational achievements. The company completed a $500 million revolving credit facility and a significant royalty interest acquisition in the Midland Basin, enhancing its portfolio and positioning for future growth despite broader commodity price challenges.
Private Placements and Financing
Texas Pacific Land Secures $500M Credit Facility
Positive
Oct 27, 2025
On October 23, 2025, Texas Pacific Land Corporation entered into a $500 million revolving credit facility agreement with Wells Fargo Bank and other lenders, maturing on October 23, 2029. The credit facility, which remains undrawn, enhances the company’s liquidity and positions it for growth opportunities, supported by strong backing from twelve financial institutions.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.