Executives at Horizon Kinetics, including Chairman and CEO Murray Stahl, have recently increased their stakes in Texas Pacific Land Corp (NYSE:TPL), a company operating in the oil royalty sector. The purchases, which took place on August 27, 2024, amounted to a total of $10,297, with share prices ranging between $857.70 and $859.56.
The series of transactions involved the acquisition of common stock in the company, signaling confidence from the executives in the future of Texas Pacific Land Corp. The purchases were made through various entities associated with Horizon Kinetics, including Horizon Kinetics Hard Assets LLC, Horizon Credit Opportunity Fund LP, and others. Notably, these transactions were executed pursuant to a Rule 10b5-1 plan, which allows insiders to set up a predetermined plan to buy or sell company stock, thereby avoiding potential accusations of insider trading.
Murray Stahl, who has a controlling interest in several of the accounts used for these transactions, serves as Chairman, CEO, and Chief Investment Officer of Horizon Kinetics. However, it is important to note that he does not exercise investment discretion with respect to the securities of Texas Pacific Land Corp.
The purchases come after a 3-for-1 split of the company's common stock, as reported in a previous Schedule 13d amendment filed by Horizon Kinetics Asset Management LLC. This split effectively multiplied the number of shares reported in the Schedule 13d by three.
Horizon Kinetics' pecuniary interest in the shares beneficially owned is disclosed in the latest SEC filings, along with the accounts in which Stahl has a controlling interest, reported as separate line items. These accounts are managed by Horizon Kinetics Asset Management LLC, where Stahl does not participate in investment decisions regarding the securities of Texas Pacific Land Corp.
Investors often view insider purchases as a positive sign that executives believe in the company's prospects and are willing to invest their own money into the stock. For Texas Pacific Land Corp, these recent acquisitions by Horizon Kinetics executives could be interpreted as a reaffirmation of their commitment to the company's growth and success.
In other recent news, Texas Pacific Land Corporation (TPL) has posted record results in its Water Services and Operations segment for the second quarter of 2024. The company reported consolidated revenues of approximately $172 million, a 14% year-over-year growth, and diluted earnings per share of $4.98. The water segment set corporate records across various performance indicators, including sales revenues, volumes, and net income.
In addition to these impressive results, TPL's oil and gas royalty production slightly increased, with plans to expand its mineral and royalty assets in the Permian Basin. The company also celebrated its 136-year anniversary by participating in the opening bell ceremony at the New York Stock Exchange and was recently included in the S&P 400.
These developments highlight TPL's strategic focus on enhancing intrinsic value per share through selective and disciplined M&A pursuits. The company aims to maintain a $700 million target cash balance to leverage market opportunities, with the majority of free cash flow intended for share repurchases and dividends. These recent developments indicate a robust performance and strategic approach to capitalize on market opportunities.
InvestingPro Insights
Following the recent insider purchases by executives at Horizon Kinetics, Texas Pacific Land Corp (NYSE:TPL) presents a mix of intriguing financial metrics and market performance. The company's strong financial health is highlighted by an impressive gross profit margin of 93.61% for the last twelve months as of Q2 2024, which showcases its efficiency in maintaining profitability. This is further reinforced by the fact that Texas Pacific Land Corp holds more cash than debt on its balance sheet, indicating a robust financial position that can weather market fluctuations and invest in growth opportunities.
Additionally, the company's ability to consistently reward shareholders is evident, as it has maintained dividend payments for 11 consecutive years, with a dividend growth of 8.0% during the last twelve months as of Q2 2024. This commitment to returning value to shareholders, combined with a dividend yield of 0.55%, may appeal to income-focused investors.
Market performance data also reflects positively on Texas Pacific Land Corp, with a significant 3-month price total return of 41.27% and a 6-month price total return of 69.97% as of the date of the last data. Trading near its 52-week high, with a price percentage of 99.26% of the high, the company's stock demonstrates strong market confidence.
While Texas Pacific Land Corp is currently trading at a high earnings multiple, with a P/E ratio of 44.93, investors should consider the company's long-term growth prospects alongside these metrics. For those interested in a deeper analysis, InvestingPro offers additional tips and metrics to help evaluate the company's valuation and performance.
For further insights and a comprehensive set of InvestingPro Tips, investors can visit https://www.investing.com/pro/TPL, where an additional 17 tips are available to assist in making informed investment decisions.
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