TPL Texas Pacific Land

Texas Pacific Land Corporation owns a large acreage of surface land in the Permian Basin, generating revenue from oil and gas royalties, water services, and surface leasing. Sector: Energy.

Texas Pacific Land (TPL) is an individual stock. The analysis below presents key financial metrics for the company, covering profitability, capital efficiency, valuation, margins, and growth.

From a capital efficiency perspective, ROIC is 45.46%, WACC is 8.65%, and the economic spread is 36.81%. On balance, the company exhibits an exceptional economic spread, compounding intrinsic value at a rate few companies can match. Supporting metrics show ROE at 37.22% and ROA at 29.73%, a combination that helps frame whether profitability strength is broad enough to hold through different market conditions. Taken together, the return profile suggests a company with credible compounding capacity if current operating execution persists.

Valuation currently screens at trailing P/E of 63.70, forward P/E of 52.02, PEG of 3.12. The gap between trailing and forward multiples is wide, suggesting the market is pricing meaningful earnings expansion over the coming year. At this PEG level, the company is priced generously relative to its expected earnings trajectory — execution risk is meaningfully priced in. The current ratio of 4.37 indicates the company is well-positioned to meet near-term obligations. The valuation profile here is neither obviously cheap nor dramatically expensive — a setup where the return case is built more on earnings delivery than on re-rating potential.

On the margin front: gross margin sits at 89.38%, operating margin at 74.24%, and free cash flow margin at 32.48%. At this gross margin level, the company demonstrates significant pricing power and production efficiency. The operating margin here is a standout — reflecting businesses that convert a large share of gross profit into operating earnings. At this FCF margin level, the company have considerable financial flexibility without reliance on external financing. This margin set supports the view that earnings quality is high and cash generation is not merely accounting-driven.

On the forward picture: TTM revenue growth of 13.88% reflecting consistent if unspectacular revenue expansion. Consensus EPS estimates point to 22.5% earnings growth over the next 12 months — a compelling near-term earnings catalyst that, if delivered, changes the valuation conversation materially. Analyst price targets suggest street expectations point to meaningful upside if execution holds on a 12-month view. Revenue growth is grounded in reported results; price targets are forward projections that embed assumptions about multiple expansion, earnings delivery, and macro conditions. The key risk in both directions is whether the company can maintain their operating trajectory as macro and sector conditions evolve. The estimated 12-month price change is based on analyst consensus price target estimates, sourced from publicly available data, and should not be interpreted as a reliable prediction of future performance.

Across the metrics reviewed, the evidence is consistently constructive — quality, growth, and valuation are pulling in the same direction.

This summary is based on publicly available quantitative data and is not intended as investment advice. Carefully consider your personal financial circumstances before making any decisions.