Two Articles, One Day

Two fun reads posted today on Seeking Alpha.

As always, the comment section is where the magic happens.  I particularly liked (and agree with) the comment highlighted below.  I echo the sentiment of playing the long game with the assets while being fastidious about balance sheet and expense management.

To the board:  Don’t change into every other company.  Don’t become an agency problem disguised as a functioning company.  Don’t get hijacked by quarterly EPS and managment options awards/vesting culture.  Management should be rewarded for serving the holders of equity, not for serving themselves.  It’s a slippery slope.  Be brave and work hard.


Much here depends on how responsibly TPL’s BOD manages this.If management hands out free stock like candy we’d have a problem.If management were smart, they would “signal” their intent to continuewith share buybacks at opportune times with the intent to shrink outstandingshares over the long run. Maybe they will use their stock to acquire situationsthat will add value to TPL. The asset base TPL has is “top shelf” and potentialis there to manage it to shareholders advantage, not managements paycheck.Hopefully they will not squander this opportunity before them. Land assets couldbe used to support a move into “green” operations such as solar and wind farms.Would be fantastic to get Tesla to build on TPL lands if at all feasible. Solidmanagement could do great things here. Bad management could do severedamage. Too early in the game to know what we have. Thanks for writing thisarticle…I was hoping we’d see one soon!

6 thoughts on “Two Articles, One Day

  1. That same comment is what resonated with me. I always read the comments before the story. I’m focused on real assets and TPL is like 50%+ of my portfolio. I agree with the conviction of how valuable this asset is. I have even resisted selling but damn it, haha we really live in crazy times for investing!

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  2. Nice find on the article on SA. Agree its undervalued and misunderstood.

    I believe HK and Murray/Stahl will continue to be good stewards for shareholders. They control 25% of the stock, have been owning the stock for decades, and are clever at knowing how compounding works. I can’t see them running it into the ground with bad governance and poor decisions with their massive ownership.

    The big mystery for me is when will the conversion take place? In theory, we have communication that says it will be completed by the end of September 2020. Which is kind of odd semantics, instead of an exact date, or saying by the end of September they will announce when the conversion will be. I think we will wake up and see the news it happened overnight, and our shares are now TPLC.

    Its also interesting how little the trust protects the shareholders. One would think shareholders would need to vote tto approve the conversion to a c-corp, but the trustees can decide that at any time. One might also think the shareholders could pick the new c-corp directors, but no, thats also done by the trustees. I can’t wait to have these kind of things change.

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