TPL
Texas Pacific Land Corporation$523.31
Unclear
Target $295.80
Report: Mar 13, 2026Energy • Oil & Gas Exploration & Production • Mature CompounderSnapshot
Decision-first overview with recommendation, valuation anchor, and current setup.
Company Overview
Research Snapshot
Price History
Pelican View
Current$523.31-43.5%
Rec: UnclearConviction: High
Entry Target
$227.54
(57% below current)
Fair Value
$295.80
(43% below current)
Stop Loss
$182.03
(65% below current)
Position Size
Starter
Time Horizon
Long-Term (3+ Years)
Key Metrics
Live Snapshot
Market Data
52 Week High$547.20
52 Week Low$269.23
Avg. 3 Month Volume510K
Efficiency
LTM Gross Margin85.0%
LTM EBITDA Margin84.4%
LTM EBIT Margin76.6%
LTM Operating Margin74.2%
LTM ROA32.6%
LTM ROE36.2%
LTM ROIC63.3%
LTM ROCE44.6%
Capital Structure
Market Cap (MM)$32.7B
Enterprise Value (MM)$32.6B
Shares Outstanding68.94M
Total Debt (MM)$16.18M
Cash & Equivalents (MM)$144.81M
LTM Net Debt (MM)$-128.63M
LTM Net Debt/EBITDA-0.2x
Growth
TTM Rev. Growth13.1%
Last 3-Yr Rev. CAGR6.1%
Last 3-Yr EBITDA CAGR4.9%
Last 3-Yr EPS CAGR2.8%
Valuation
Street Target Price$639.00
LTM EV/Revenue40.8x
LTM EV/Gross Profit48.0x
LTM EV/EBIT53.3x
LTM EV/EBITDA48.4x
LTM P/E68.0x
LTM EV/FCF-8539.9x
LTM P/FCF-8573.6x
LTM P/TB20.6x
LTM P/B22.4x
Dividend Yield0.4%
Payout Ratio30.6%
Executive SummarySituation: Current price is $523.31 versus fair value $295.8 (-43.5% expected return), and valuation confidence is insufficiently stable. Debate: Bull case depends on Desalination Cost Validation Management must prove the Phase 2B facility can achieve the $0.75 per barrel cost target to justify the massive capex spend. Bear case centers on Moat Erosion via Capital Intensity The transition to a capital-heavy model permanently impairs the company's ability to return cash to shareholders and lowers the sustainable ROIC. Conclusion: Recommendation is Unclear; maintain no position until reliability and catalyst evidence improve.
Bull Case
The 'Permian ETF' narrative suggests TPL is a perpetual royalty machine with 95% gross margins and zero debt. The Bolt Data & Energy partnership provides high-margin optionality in the AI infrastructure boom, potentially decoupling the stock from oil price cycles.
Bear Case
Capex intensity has exploded to 68.9% of revenue, turning free cash flow negative and eroding the 'capital-light' thesis. Valuation at 74.9x P/E is extreme compared to the 3-year average of 54.3x, especially as operating margins have compressed from 76.4% to 74.2%.
Key Catalysts
Mid-Term (6-18 months)Impact: High
Desalination Cost Validation Management must prove the Phase 2B facility can achieve the $0.75 per barrel cost target to justify the massive...
Mid-Term (6-18 months)Impact: High
The primary value driver is a transition toward water services and data center infrastructure, but this shift is being funded by a $549.7 mi...
Long-Term (18+ months)Impact: Moderate
TPL is relevant for analysis now because the recent 10.4% price jump following Q4 earnings has pushed the valuation to a level that is compl...
Primary Risks
Concern: High
Moat Erosion via Capital Intensity The transition to a capital-heavy model permanently impairs the company's ability to return cash to share...
Concern: Medium
The bear case is defined by moat erosion and declining profitability. The final Bear Case value of $261.24 assumes Permian seismic regulatio...
Concern: Medium
The governance outcome tree is currently in a 'Status Quo' phase where the current management plan executes. However, if the desalination an...
Recent Activity
2026-02-19SEC Filing (8-K)
+10.40%Texas Pacific Land Corporation announces Q4 2025 and full year 2025 results
2025-12-17SEC Filing (8-K)
+7.59%Texas Pacific Land Corporation announces strategic agreement with Bolt Data & Energy to develop data center infrastructure on TPL land
2025-12-03SEC Filing (8-K)
+5.79%Texas Pacific Land Corporation finalizes December 22, 2025 effective date for previously announced three-for-one stock split
2025-11-06SEC Filing (8-K)
+10.02%Texas Pacific Land Corporation announces Q3 2025 results
2025-08-07SEC Filing (8-K)
-8.75%Texas Pacific Land Corporation announces Q2 2025 results with record production and dividend increase
Valuation Table
4.6/10Directional
Scenario Range
$1
Bear
$343
Base
$432
Bull
$523