LandBridge could benefit from AI data center, renewable boom

LandBridge LLC

23/07/2024 18:50

** Several brokerages initiated coverage on LandBridge
 LB.N , a landowner in the oil-rich Permian Basin in the U.S. 
    ** Co owns ~220,000 surface acres in Texas and New Mexico,
in the Permian, one of the most active oil and natural gas
development regions in the world
    ** Piper Sandler ("neutral") initiates coverage at $30, says
while co is focused on oil and gas development in the Delaware
Basin, it eyes AI and data center build out for additioanl
revenue
    ** "LB sees using excess gas to its advantage to create
lower cost power generation to support energy-intensive data
centers" - Piper Sandler
    ** "LB offers more optionality than energy companies though;
with stated goals to expand its land use into solar, wind, data
centers and other long-duration growth sectors" - Citi analysts
("neutral", PT $31)
    ** Barclays ("equal weight", PT $29) says LB's positives are
balanced by its sponsor equity overhang, potential acquisition
related execution risk, and small size
    ** Raymond James ("outperform", PT $34) says "revenues tied
to construction easements could materialize as soon as 2025, and
overall potential to the financial model is very high"
    ** Shares of LB down 2.8% at $28.7, up nearly 69% since its
IPO in June

 (Reporting by Seher Dareen in Bengaluru)
 ((Seher.Dareen@thomsonreuters.com;))