NYSE:TPL

Stock Analysis Report

Texas Pacific Land Trust

Executive Summary

Texas Pacific Land Trust holds title to tracts of land in the state of Texas.

Rewards

Trading at 39.3% below its fair value

Earnings are forecast to grow 5.08% per year

Earnings grew by 81.9% over the past year

Risk Analysis

High level of non-cash earnings

Highly volatile share price over past 3 months



Snowflake Analysis

Flawless balance sheet with proven track record.


Similar Companies

Limoneira

NasdaqGS:LMNR

Share Price & News

How has Texas Pacific Land Trust's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: TPL's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-2.0%

TPL

-1.0%

US Oil and Gas

2.0%

US Market


1 Year Return

22.0%

TPL

-7.6%

US Oil and Gas

23.5%

US Market

Return vs Industry: TPL exceeded the US Oil and Gas industry which returned -4.2% over the past year.

Return vs Market: TPL underperformed the US Market which returned 24.4% over the past year.


Shareholder returns

TPLIndustryMarket
7 Day-2.0%-1.0%2.0%
30 Day12.0%0.06%4.3%
90 Day33.9%6.0%12.2%
1 Year23.0%22.0%-4.2%-7.6%26.1%23.5%
3 Year147.5%142.5%-8.5%-16.9%53.1%43.2%
5 Year637.3%619.4%-11.4%-24.3%75.5%56.1%

Price Volatility Vs. Market

How volatile is Texas Pacific Land Trust's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Texas Pacific Land Trust undervalued compared to its fair value and its price relative to the market?

39.7%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: TPL ($799.45) is trading below our estimate of fair value ($1316.08)

Significantly Below Fair Value: TPL is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: TPL is poor value based on its PE Ratio (19.9x) compared to the Oil and Gas industry average (10.2x).

PE vs Market: TPL is poor value based on its PE Ratio (19.9x) compared to the US market (18.9x).


Price to Earnings Growth Ratio

PEG Ratio: TPL is poor value based on its PEG Ratio (3.9x)


Price to Book Ratio

PB vs Industry: TPL is overvalued based on its PB Ratio (14x) compared to the US Oil and Gas industry average (1x).


Next Steps

Future Growth

How is Texas Pacific Land Trust forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

5.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: TPL's forecast earnings growth (5.1% per year) is above the savings rate (1.7%).

Earnings vs Market: TPL's earnings (5.1% per year) are forecast to grow slower than the US market (14.3% per year).

High Growth Earnings: TPL's earnings are forecast to grow, but not significantly.

Revenue vs Market: TPL's revenue (5.8% per year) is forecast to grow slower than the US market (7.5% per year).

High Growth Revenue: TPL's revenue (5.8% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if TPL's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Texas Pacific Land Trust performed over the past 5 years?

49.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: TPL has a high level of non-cash earnings.

Growing Profit Margin: TPL's current net profit margins (66.5%) are lower than last year (69.7%).


Past Earnings Growth Analysis

Earnings Trend: TPL's earnings have grown significantly by 49.1% per year over the past 5 years.

Accelerating Growth: TPL's earnings growth over the past year (81.9%) exceeds its 5-year average (49.1% per year).

Earnings vs Industry: TPL earnings growth over the past year (81.9%) exceeded the Oil and Gas industry -13.3%.


Return on Equity

High ROE: TPL's Return on Equity (70.4%) is considered outstanding.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Texas Pacific Land Trust's financial position?


Financial Position Analysis

Short Term Liabilities: TPL's short term assets ($312.7M) exceed its short term liabilities ($23.9M).

Long Term Liabilities: TPL's short term assets ($312.7M) exceed its long term liabilities ($54.7M).


Debt to Equity History and Analysis

Debt Level: TPL is debt free.

Reducing Debt: TPL has not had any debt for past 5 years.

Debt Coverage: TPL has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: TPL has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: TPL has a low level of unsold assets or inventory.

Debt Coverage by Assets: Insufficient data to determine if TPL's debt is covered by short term assets.


Next Steps

Dividend

What is Texas Pacific Land Trust's current dividend yield, its reliability and sustainability?

0.76%

Current Dividend Yield


Dividend Yield vs Market

company0.8%marketbottom25%1.4%markettop25%3.7%industryaverage4.1%forecastin3Years1.0%

Current dividend yield vs market & industry

Notable Dividend: TPL's dividend (0.75%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.4%).

High Dividend: TPL's dividend (0.75%) is low compared to the top 25% of dividend payers in the US market (3.66%).


Stability and Growth of Payments

Stable Dividend: TPL is not paying a notable dividend for the US market, therefore no need to check if payments are stable.

Growing Dividend: TPL is not paying a notable dividend for the US market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: TPL is not paying a notable dividend for the US market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of TPL's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

What is the CEO of Texas Pacific Land Trust's salary, the management and board of directors tenure and is there insider trading?

3.2yrs

Average management tenure


CEO

Tyler Glover (34yo)

3.2yrs

Tenure

US$2,312,025

Compensation

Mr. Tyler Glover has been Chief Executive Officer, General Agent and Secretary at Texas Pacific Land Trust since November 05, 2016. Mr. Glover has been Assistant General Agent of Texas Pacific Land Trust s ...


CEO Compensation Analysis

Compensation vs Market: Tyler's total compensation ($USD2.31M) is below average for companies of similar size in the US market ($USD6.46M).

Compensation vs Earnings: Tyler's compensation has increased by more than 20% in the past year.


Management Age and Tenure

3.2yrs

Average Tenure

Experienced Management: TPL's management team is considered experienced (3.2 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyUS$301,93008 Oct 19
Allan Tessler
EntityIndividual
Shares500
Max PriceUS$603.86
BuyUS$83,61208 Apr 19
SMP Asset Management, LLC
EntityCompany
Shares112
Max PriceUS$796.00
BuyUS$6,613,56515 Mar 19
Horizon Kinetics LLC
EntityCompany
Shares8,405
Max PriceUS$786.89
SellUS$8,341,91215 Mar 19
Horizon Kinetics LLC
EntityCompany
Shares10,710
Max PriceUS$778.89
SellUS$8,602,66315 Mar 19
SoftVest Management, LP
EntityCompany
Shares11,500
Max PriceUS$789.98

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Robert Packer (50yo)

    General Agent

    • Tenure: 5.1yrs
    • Compensation: US$2.33m
  • Sameer Parasnis

    Executive VP & Chief Commercial Officer

    • Tenure: 0.4yrs
  • Chris Steddum

    Vice President of Finance & Investor Relations

    • Tyler Glover (34yo)

      General Agent

      • Tenure: 3.2yrs
      • Compensation: US$2.31m

    Board Members

    • John Norris (65yo)

      Co-Chairman

      • Tenure: 0.9yrs
      • Compensation: US$104.00k
    • David Barry (74yo)

      Co-Chairman

      • Tenure: 0.9yrs
      • Compensation: US$104.00k

    Company Information

    Texas Pacific Land Trust's company bio, employee growth, exchange listings and data sources


    Key Information

    • Name: Texas Pacific Land Trust
    • Ticker: TPL
    • Exchange: NYSE
    • Founded: 1888
    • Industry: Oil and Gas Exploration and Production
    • Sector: Energy
    • Market Cap: US$6.165b
    • Shares outstanding: 7.76m
    • Website: https://www.tpltrust.com

    Number of Employees


    Location

    • Texas Pacific Land Trust
    • 1700 Pacific Avenue
    • Suite 2770
    • Dallas
    • Texas
    • 75201
    • United States

    Listings

    TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
    TPLNYSE (New York Stock Exchange)YesCertificates of Proprietary InterestUSUSDJan 1968
    9TPDB (Deutsche Boerse AG)YesCertificates of Proprietary InterestDEEURJan 1968

    Biography

    Texas Pacific Land Trust holds title to tracts of land in the state of Texas. The company operates through two segments, Land and Resource Management, and Water Service and Operations. It sells, leases, and manages these lands for the benefit of the holders of Certificates of Proprietary Interest in the Trust. The company has oil, gas, and water royalty interests; enter into easement contracts covering activities, such as oil and gas pipelines and subsurface wellbore easements; leases land; and sells water and land. As of December 31, 2018, it owned the surface estate in approximately 902,177 acres of land comprising various separate tracts located in 19 counties in the western part of Texas. The company also owns a 1/128 nonparticipating perpetual oil and gas royalty interest under 84,934 acres of land, as well as a 1/16 nonparticipating perpetual oil and gas royalty interest under 370,737 acres of land in the western part of Texas; and oil and gas royalty interests in approximately 1,826 net royalty acres. Texas Pacific Land Trust was founded in 1888 and is headquartered in Dallas, Texas. 


    Company Analysis and Financial Data Status

    All financial data provided by Standard & Poor's Capital IQ.
    DataLast Updated (UTC time)
    Company Analysis2020/01/17 23:40
    End of Day Share Price2020/01/17 00:00
    Earnings2019/09/30
    Annual Earnings2018/12/31


    Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.