Episode
Texas Pacific Land Corporation: The Riches of Royalties
- Podcast
- Preferred Shares Podcast
- Published
- Mar 3, 2025
- Duration seconds
- 3076
- Processing state
not_requested
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Summary
Welcome to Episode 19 of the Preferred Shares Podcast. We interviewed a special guest, Chadd Garcia, about Texas Pacific Land Corporation (TPL). Chadd is a veteran investment analyst, has worked in private equity, and is currently Vice President & Portfolio Manager at Ave Maria Mutual Funds . In This Episode Here are some highlights from the podcast episode about Texas Pacific Land Corporation (TPL): * [1:52] – Chadd explains how he became interested in TPL. * [2:53] – TPL’s early history * [4:48] – Oil was discovered in West Texas in the 1920s, but fracking in the 2010s significantly increased the value of the land. * [6:17] – TPL’s decision to get in the water business to support fracking. * [11:12] – TPL’s unique shareholder base, comprised of long-term investors and Texas families. * [14:11] – The reasons for internally handling the water business. * [16:54] – The best way to assess TPL’s valuation, considering its unique advantages and potential call options. * [18:07] – Discussion about the potential of data centers in the Permian Basin. * [23:00] – Chadd shares his view that management would be better off allocating capital to share repurchases. * [31:04] – Chadd is generally not a fan of TPL acquiring royalties. * [36:14] – Discussion of how and why TPL recently became a corporation after being a trust for over 130 years. * [38:09] – Chadd shares some concerns with management’s compensation structure. * [40:22] – Appropriate incentive schemes for royalty companies. Additional Reading & Listening Curious to see what else we’ve been working on? Check out some of the interesting things we’ve done recently: * Lawrence Hamtil ( Fortune Financial and @lhamtil ) was recently interviewed by Paul Cerro of Cedar Grove Capital. They discussed military history and the defe…