The Truth about TPL, Horizon, and the Asset/Liability Mismatch

Gotham City Research LLC
Jul 24
2 min read

GOTHAM CITY RESEARCH’S OPINIONS

TPL stock is up over 4x since 2019 due to forced, price insensitive buyers and misplaced confidence in Horizon.
TPL business is inflecting into a lower quality, capital intensive business with less growth and lower ROICs.
We believe shares will approach $361-$440 per share, implying 53%-61% downside vs current price.

SUMMARY OF THE BASES OF OPINIONS

TPL stock was up ~100x from 2002-2019, tracking EPS growth, which also grew ~100x. From 2019-2024, however, EPS only grew 1.4x, yet the stock, 4.2x.
TPL was an ‘index ineligible trust’. Horizon led a campaign to change TPL’s corporate form and succeeded. TPL, thus, became an index eligible corp as of 2021.
Vanguard, BlackRock, and State Street - Price insensitive, forced buyers of the stock – increased their combined ownership of TPL stock from <1% in 2020 to 24%, 2025.
Form 4 filings give the appearance that Horizon Kinetics and its CIO Murray Stahl – a board member of TPL – are steady and consistent buyers of TPL stock.
Horizon Kinetics funds have actually been massive sellers of TPL stock since 2019. We calculate that their TPL position has declined by -34% since the end of 2018.
Horizon’s TPL position represents ~40% of its equity, and over 30x TPL ADV. We believe Horizon is smart and therefore will continue to sell TPL stock, for risk management purposes.
TPL claims to be a ‘growth-oriented enterprise’ yet its employee count has barely grown since 2020.
A former TPL employee – in charge of data center business development – believes data centers will be worth at most a few million dollars per year in land lease.
TPL spent $471 million on acquiring assets in 2024.
TPL spent more in 2024 on acquisitions, than they did in the previous 22 years (2002-2023) - combined.
In 2024, TPL purchased oil and gas interests for $34,107 per NRA. Historically their purchases averaged $11,000/NRA.
TPL’s has purchased and sold land for $2,569-$2,855 per acre (on a weighted avg basis) over the last 8 years, yet TPL’s market cap per acre is over $25,000 per acre.
TPL paid for stock promotion ads in 2024. This is not behavior we expect to see in a S&P 500 constituent.
Karl Kurz is a member of the TPL Board, since April 15, 2022. Kurz’s TPL bio fails to mention that he was on BoD of Royal Helium – a Canadian penny stock promote until May.