*Texas Pacific Land Trust Declares Cash Div of $10/Sub-Shr, an Increase of $8.25 Over Cash Div Paid in 2019 >TPL
*Texas Pacific Land Trust Declares Special Div of $6/Sub-Shr, an Increase of $1.75 Over Special Div Paid in 2019 >TPL
$16 x 7,756,156 = $124MM payout.
$250MM on balance sheet as of 9/30. Plus another ~$60MM generated in 4Q ($91MM cash rev – $23MM op ex -$6MM cash tax =$62MM) less payout implies that ~$186MM remains. $24/share held back.
DALLAS–(BUSINESS WIRE)–Texas Pacific Land Trust (NYSE: TPL) announced today that its Trustees have declared a cash dividend of $10.00 per sub-share, an increase of $8.25 over the cash dividend paid in 2019, payable March 16, 2020 to sub-shareholders of record at the close of business on March 9, 2020. This is the 17th consecutive year that the regular dividend has increased. Additionally, the Trustees declared a special dividend of $6.00 per sub-share, an increase of $1.75 over the special dividend paid in 2019, payable March 16, 2020 to sub-shareholders of record at the close of business on March 9, 2020.
Does $10/sub share (regular dividend raised 5.7x) set you up for a $1/share div post split? Hard to take that regular div bar down. ~$77MM/year will now no longer be used towards repurchases.
The Texas Pacific Land Trust Investor 
I personally am disappointed with capitol allocation and will probably send an email to investor relations. Would prefer share buybacks or at least 50% of cash used for buybacks. Hopefully there will be clarity here soon with the C- corp details.
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Markets don’t like decreasing dividends, so $10 is the new goalpost. Even at that, it’s less than 1.25%, so income seekers would not be attracted. Ex-dividend date is interesting. Usually I believe they made it the day prior to the announcement. Now it gives the market opportunity to buy the stock to capture the dividend.
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Now it has a better yield than the 30yr Tsy and actually has assets behind it.
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Looks like they are going to use 60% of the net income (without land sales) for dividends, and 40% for buybacks, if we look at the 2019 net icome.
But I expect for next years (with increasing net income) 60 buybacks/40 dividends. Because I don’t expect increases on dividends at this kind of rate, so 10% growing anually can work, and the rest will be used as buybacks.
I prefer only buybacks, it’s a mistake not doing that at these prices in a business like this.
I think they are going to tender offer with the cash in hand as soon as they convert to c-corp and post-split. Maybe $150M or 200.000 shares.
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Horizon got their way. This is the new norm, like it or not.
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How do you know that’s what they wanted?
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the company is .making money selling their assets. As shareholders we need to share in the profits. buybacks cannot make us money unless we sell our shares. that is like having a job not getting paid unless we quit.
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if you invest in business with that way of thinking you are not going to do much better than the index
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