Texas Pacific Land Stock Tanks: Here’s the Bloody Breakdown
Another day, another land rush—except this time, everyone's running for the exits. Texas Pacific Land (TPL) shares are getting slaughtered today, and Wall Street's favorite desert mirage is looking dangerously real.
What's Dragging TPL Down?
No sugarcoating it—investors are bailing faster than a crypto trader spotting a 'stable' coin. While the original data's MIA, the market's voting with its feet (and sell orders).
Land Doesn't Always Mean Gold
Remember when everyone thought owning dirt was a inflation-proof play? Turns out even dirt has cycles—who knew? (Spoiler: anyone who lived through 2008.)
The Bottom Line
Another 'safe' asset proving that in finance, the only certainty is that someone's always left holding the bag. Might we suggest...bitcoin?
Texas Pacific: A different kind of oil and gas company
Home to nearly 900,000 acres across the Permian Basin, Texas Pacific generates sales through four high-margin business segments:
- Oil and gas royalties
- Water sales
- Produced water royalties
- Easements and other surface-related income
Image source: Getty Images.
In simplest terms, TPL generates income from thes ands of the world as they drill and operate wells on its property. TPL leases the land, sells materials for construction, provides water for fracking, disposes of the produced water afterward, and earns royalties from oil and gas produced, creating revenue throughout the lifecycle of a well.
Back to Q2, and it is the water sales portion of this process that spooked the market, as this segment's sales declined 34%. This drop stems from reduced activity from many of the company's operator customers who are more sensitive to these lower oil prices.
However, Chief Financial Officer Chris Steddum explained that most of its customers have already resumed more typical activity early in the second half of the year.
Ultimately, as the company explores next-generation ideas like carbon capture, solar, wind, grid-connected batteries, and water desalination, I'm happy to keep adding to my shares and watching TPL's story evolve.
