Texas Pacific Land Corporation (TPL)

[Aitkenresearch]

Momentum of TPL’s variables?
-On the way up in the last 2-3 years,

1. Market was climbing. Margin leverage. Only need more in for more profits. ??
2. Oil price rising.
3. More Production
4. Apache News in October 2016
5. Tax cut really added fuel to the bottom line fire.
6. Buying back sub-certif.
6. No quarterly estimates. Just more earnings than y/y.

How many of the green lights momentum above have changed recently?
A lot.
We kinda ran out of buyers at such a high price. Price doesn’t matter but....it does for small investors which we need.

Now Interest rates are rising. Pipelines need time. Oil price falling 20%.

Longer term bullish case?

33 year old CEO wants to be more active? What does mean? Water Business or even more businesses of growth.
Dividend? Stock split-to gain more investors to the stock.

Options?

What was the secret sauce that made TPL a very rare opportunity I think has been played out.

Macro play.
Eventually the Fed is going to try and stoke the fire of inflation again. When that happens TPL will be one of the best inflation hedges in the market with no debt.

Analogy of a blockbuster movie.
At some point the attendance has to peak and movie goers won’t want to pay a high multiple to trade their tickets.

Any other opinions?