Texas Pacific Land slips in first day of trading in S&P 500

Texas Pacific Land (Dover)

26/11/2024 19:41

** Shares of Texas Pacific Land Corp  TPL.N  down 4.6% at
$1,539.27 as co joins S&P 500  .SPX  on Tues
    ** Dallas-based TPL, which owns 873,000 surface acres in the
oil-rich Permian Basin, has seen its stock more than triple this
year and now has current market cap of around $35 bln, aided by
enthusiasm over artificial intelligence
** TPL shares on Fri surged 14% to close at $1,730, a day after
news co would replace Marathon Oil in the benchmark index
** Marathon was bought by shale producer ConocoPhillips  COP..N 
** In Q3, TPL generated ~$174 mln of revenues, comprising ~$94
mln in oil and gas royalties and ~$80 mln from water sales and
royalties, and fees for cos using its land (Click here for
investor presentation)
    ** Bitcoin mines, utility-scale battery projects and
renewable power are being produced on TPL's land, and co cited
opportunities to lease land to data centers
** "TPL just has a lot of positive attributes for data centers
and nobody has more land than us in West Texas. So another
thing, too, is if we need to buy more land to accommodate a data
center, then we have proven that, that's not hard for us to do
so," CEO Tyler Glover said on the earnings call
    ** Investment manager Horizon Kinetics is the biggest TPL
holder with ~3.69 mln shares, or ~16% stake, per LSEG data
** Horizon Kinetics is also a major investor in LandBridge
 LB.O , which owns about 220,000 surface acres in the Permian.
LB shares have soared since co's Jun IPO priced at $17 and are
currently trading at $78 as co viewed potentially benefiting
from AI and data center build out
** Last week, LB agreed to buy more land and boost its acreage
to ~272,000 surface acres, pointing to "potential digital
infrastructure and renewable energy projects"

 (Lance Tupper is a Reuters market analyst. The views expressed
are his own)
 ((lance.tupper@tr.com 1-646-279-6380))