Texas Pacific Land Corp. (NYSE:TPL)

Asset Turnover

The reported and adjusted total asset turnover ratios declined significantly from 0.82 and 0.83 in 2019 to 0.53 and 0.54 respectively in 2020. A slight recovery occurred in 2021 and 2022, peaking at 0.76, before declining again to 0.55 in 2023. This pattern suggests fluctuating efficiency in utilizing assets to generate revenue, with a notable dip in 2020 followed by partial improvement and subsequent decrease.

Liquidity Ratios

The reported current ratio remained very high throughout the period, increasing from 14.99 in 2019 to 19.43 in 2023, indicating strong liquidity. The adjusted current ratio shows a similar trend but with more pronounced fluctuations, jumping from 14.99 in 2019 to 19.14 in 2020, dropping to 11.18 in 2021, then increasing steadily to 22.67 by 2023. These elevated current ratios suggest excess short-term assets relative to current liabilities, possibly indicating conservative liquidity management or underutilization of current assets.

Leverage Ratios

Reported debt to equity and debt to capital ratios data are unavailable. Adjusted ratios for both debt to equity and debt to capital remained minimal to zero during 2019 through 2023, indicating negligible reliance on debt financing. Reported financial leverage decreased slightly from 1.17 in 2019 to 1.11 in 2023, while the adjusted measure remained relatively stable near 1.04, reflecting a consistent low level of leverage and a capital structure dominated by equity.

Profitability Margins

Reported net profit margin showed a general decline from 64.98% in 2019 to 58.19% in 2020, followed by a modest recovery around 60% in 2021 and an increase to a peak of 66.88% in 2022 before a slight decrease to 64.23% in 2023. The adjusted net profit margin exhibits a similar pattern but with consistently higher values, peaking at 67.7% in 2022. This indicates strong profitability throughout the period with some variations potentially due to external or one-time factors.

Return on Equity (ROE)

ROE experienced a sharp decline from very high levels of 62.23% reported (61.08% adjusted) in 2019 to roughly half in 2020 (36.28% reported and 32.96% adjusted). A gradual recovery occurred in subsequent years, reaching 57.75% (reported) and 53.92% (adjusted) in 2022 before falling again to around 38.8% in 2023. This indicates variability in generating shareholder returns linked to changes in net income and equity base over time.

Return on Assets (ROA)

ROA follows a similar trend to ROE, declining sharply between 2019 and 2020 from 53.28% reported (58.24% adjusted) to approximately 30%, recovering to above 50% in 2022, and again declining to about 35% in 2023. This mirrors the asset turnover and profitability fluctuations, reflecting variable effectiveness in asset utilization to generate profits.

Summary of Trends

Overall, the company demonstrates very high liquidity and low leverage with consistently strong profitability, although there are evident fluctuations in efficiency ratios and returns starting in 2020. The reduction in asset turnover and returns in 2020 could reflect external challenges or operational inefficiencies during that period, followed by partial recovery. Elevated current ratios suggest conservative management of short-term assets versus current liabilities. The persistent low debt indicates a prudent or equity-focused financing approach.

Over the analyzed period, the revenues exhibit notable fluctuations. Initially, revenues decreased from approximately 490.5 million US dollars at the end of 2019 to around 302.6 million in 2020. Subsequently, there was a recovery to about 451.0 million in 2021, followed by a significant increase peaking at 667.4 million in 2022. In 2023, revenues slightly declined to approximately 631.6 million but remained substantially higher than earlier years.

Total assets show a consistent upward trend throughout the period. From roughly 598.2 million US dollars at the end of 2019, total assets initially dipped slightly in 2020 to about 571.6 million but then grew steadily to reach approximately 1.156 billion by the end of 2023. This growth indicates ongoing asset accumulation or appreciation over time.

The reported total asset turnover ratio, which measures revenue generated per dollar of assets, shows a declining trend with some volatility. Starting at 0.82 in 2019, it fell sharply to 0.53 in 2020, then increased moderately to 0.59 in 2021, and further to 0.76 in 2022. However, in 2023, it dropped again to 0.55. This pattern suggests variability in how efficiently the company utilized its assets to generate revenue, with recent years reflecting a diminished turnover despite asset growth.

Adjusted figures for revenues and total assets closely mirror the reported values and reveal similar trends. Adjusted revenues decrease significantly in 2020, recover in 2021 and 2022, and slightly decline in 2023, consistent with the unadjusted data. Adjusted total assets also follow the same steady upward progression as reported assets.

The adjusted total asset turnover ratio reflects the same pattern observed in the reported ratio, confirming the observed variations in asset utilization efficiency over the years. The peak turnover ratios occurred in 2019 and 2022, with notable troughs in 2020 and 2023.

In summary, the company experienced a period of revenue contraction in 2020, followed by recovery and growth through 2022, before a minor decline in 2023. Total assets increased substantially over the five-year period, yet the asset turnover ratio declined overall, indicating a reduction in operational efficiency in generating revenue from assets in the most recent year.

Current Assets

The current assets demonstrate a consistent upward trend over the five-year period. Starting from approximately $367 million at the end of 2019, the value decreased slightly in 2020 to about $333 million, followed by a significant increase in 2021 to $527 million. This growth continued with further rises to $633 million in 2022 and $862 million in 2023, indicating strengthening liquidity and asset base.

Current Liabilities

Current liabilities show some fluctuations over the period. Initially, liabilities decreased from around $24.5 million in 2019 to $21.4 million in 2020. However, there was a notable increase in 2021 to $50.9 million, followed by a decline to approximately $39.6 million in 2022 and a modest rise to $44.4 million in 2023. Despite the variability, current liabilities remain substantially lower in comparison to current assets.

Reported Current Ratio

The reported current ratio, reflecting the company’s ability to cover short-term obligations, remains consistently high throughout the period. It increased from about 15.0 in 2019 to 15.6 in 2020, saw a dip in 2021 to 10.3, but rebounded strongly to 16.0 in 2022 and further improved to 19.4 in 2023. This indicates robust liquidity management despite the rise in liabilities noted in 2021.

Adjusted Current Assets

Adjusted current assets closely mirror the pattern of reported current assets, with a minor adjustment noted in 2020 and subsequent years. Except for a small increase in 2020 (from 332,530 to 332,630 thousand USD), the figures track the reported assets rising steadily from 366,640 thousand USD in 2019 to 862,664 thousand USD in 2023.

Adjusted Current Liabilities

The adjusted current liabilities differ somewhat from the reported liabilities, particularly after 2019. While reported liabilities show an increase in 2021, the adjusted liabilities demonstrate a decline from 17,379 thousand USD in 2020 to 38,057 thousand USD in 2023, generally trending lower than reported figures. This suggests adjustments focus on refining the liability base, potentially excluding certain current liabilities for better liquidity assessment.

Adjusted Current Ratio

The adjusted current ratio indicates stronger liquidity than the reported ratio by accounting for adjustments in liabilities and assets. It starts at 15.0 in 2019, rises sharply to 19.1 in 2020, dips slightly to 11.2 in 2021, and then increases substantially to 18.1 in 2022 and 22.7 in 2023. This trend highlights improved short-term financial health and suggests cautious yet solid liquidity management over time.

Total Equity

Total equity has demonstrated a consistent upward trend over the five-year period. Starting at approximately 512 million in 2019, it slightly decreased to about 485 million in 2020 but then exhibited substantial growth in the subsequent years, reaching over 1 billion by the end of 2023. This indicates a strengthening of the company's net worth and possibly retained earnings or injections of additional equity capital.

Adjusted Total Debt

Adjusted total debt values have remained relatively low and decreased overall during the period. Beginning at approximately 3.4 million in 2019, it declined to around 2 million by 2023, with minor fluctuations in between. This low level of adjusted debt suggests a conservative leverage approach or effective debt management.

Adjusted Total Equity

Adjusted total equity shows a growth pattern similar to total equity but generally at higher absolute values. It started at about 570 million in 2019 and increased consistently each year to reach nearly 1.12 billion by 2023, indicating solid equity growth after adjustments.

Adjusted Debt to Equity Ratio

The adjusted debt to equity ratio is extremely low throughout the period, ranging from 0.01 down to essentially zero by 2021 and remaining negligible afterward. This metric confirms a very low reliance on debt financing relative to equity, highlighting the company’s strong equity position and minimal leverage.

Total Debt and Reported Debt to Equity Ratio

Data regarding total debt and reported debt to equity ratio are missing for all analyzed years, limiting the ability to assess overall debt levels or traditional debt-related risk measures. However, the available adjusted debt figures suggest limited debt exposure.

Overall Financial Position and Trends

The company exhibits a robust equity base that has grown steadily, which may support future investments or financial stability. The negligible and declining adjusted debt levels contribute to a very conservative capital structure, reducing financial risk associated with leverage. The absence of reported total debt data prevents comprehensive analysis, but the adjusted figures offer a clear view of a low-debt environment. The trend indicates prudent financial management focused on maintaining strong equity and minimizing debt obligations.

The financial data reveals several important trends over the five-year period from 2019 to 2023. Total capital consistently increased each year, indicating a strengthening capital base. Specifically, total capital grew from approximately $512 million in 2019 to over $1.04 billion in 2023, showing a substantial expansion in the company's financial resources.

Adjusted total debt remained very low throughout the period, with values fluctuating slightly but generally decreasing from $3.37 million in 2019 to around $2.02 million in 2023. This low and declining level of adjusted debt suggests the company maintains minimal leverage, which is further supported by adjusted debt to capital ratios consistently close to zero. Such ratios demonstrate that debt constitutes a negligible portion of the company’s capital structure, indicating a conservative financial policy and low financial risk.

Adjusted total capital, which includes considerations beyond reported total capital, mirrored the growth trend observed in total capital. It increased from about $573.7 million in 2019 to approximately $1.12 billion in 2023. The growth rate in adjusted total capital exceeded that of total capital, which may reflect adjustments for off-balance-sheet items or other capital-related factors, further reinforcing the expansion narrative.

Values for reported total debt and reported debt to capital are not available for any of the years, which limits analysis on reported leverage. However, the available adjusted figures suggest overall low indebtedness and a very conservative capital structure.

In summary, the data points to a company that has been consistently increasing its capital base over the last five years while maintaining very low levels of debt. This pattern reflects a strong financial position characterized by growth in capital resources and minimal reliance on debt financing.

Total Capital

Steady and significant growth from $512 million in 2019 to over $1.04 billion in 2023.

Adjusted Total Debt

Low and declining from $3.37 million in 2019 to $2.02 million in 2023, indicating minimal leverage.

Adjusted Debt to Capital Ratio

Consistently near zero, reinforcing the company's conservative financial structure with negligible debt impact.

Adjusted Total Capital

Growth from approximately $574 million in 2019 to $1.12 billion in 2023, suggesting expansion beyond reported capital.

Reported Debt and Debt to Capital Ratios

Data unavailable, limiting detailed analysis of reported leverage metrics.

The financial data indicates a consistent upward trend in both total assets and total equity over the observed period from 2019 to 2023. Total assets increased from approximately 598 million US dollars in 2019 to about 1.16 billion US dollars in 2023, reflecting significant growth and expansion in the company's resource base. Similarly, total equity showed a strong increase, rising from roughly 512 million US dollars in 2019 to over 1.04 billion US dollars in 2023, which suggests an increasing shareholder investment or accumulated earnings retained within the company.

The reported financial leverage ratio, which measures the relationship between total assets and total equity, remained relatively stable but showed a slight decline during the period, moving from 1.17 in 2019 down to 1.11 in 2023. This decrease indicates a modest reduction in the use of debt financing relative to equity, implying a potential improvement in the company's capital structure and lower financial risk.

Adjusted figures, which may reflect certain recalibrations or considerations in asset and equity valuations, show a very similar trend with adjusted total assets increasing from 598.2 million US dollars in 2019 to approximately 1.16 billion US dollars in 2023. Adjusted total equity rose from about 570.3 million US dollars to nearly 1.12 billion US dollars over the same period.

The adjusted financial leverage ratio remained consistently lower than the reported financial leverage, starting at 1.05 in 2019 and stabilizing around 1.04 from 2020 onwards through 2023. This indicates a relatively conservative leverage position when adjustments are taken into account, suggesting the company maintains a strong equity base relative to its assets.

Total Assets and Equity

Both metrics exhibited substantial growth, indicating asset accumulation and strengthening equity position over five years.

Financial Leverage

Reported leverage decreased moderately, while adjusted leverage remained stable and low, indicating prudent financial management and stable capital structure.

Adjusted vs Reported Values

The adjusted figures reflect similar growth trends with slightly more conservative leverage ratios, highlighting possible adjustments for valuation or accounting purposes that clarify the company's financial stance.

Overall, the data portrays a company with expanding asset and equity bases, maintaining conservative leverage levels and strengthening financial stability over the analyzed period.

Net Income

The net income showed a noticeable decrease from 2019 to 2020, dropping from 318,728 thousand US dollars to 176,049 thousand US dollars. It rebounded significantly in 2021, reaching 269,980 thousand US dollars, followed by a substantial increase in 2022 to 446,362 thousand US dollars. However, in 2023, net income slightly declined to 405,645 thousand US dollars, indicating some volatility over the period but maintaining an overall upward trend after 2020.

Revenues

Revenues experienced a substantial decline from 490,496 thousand US dollars in 2019 to 302,554 thousand US dollars in 2020. This was followed by a recovery trend, increasing to 450,958 thousand US dollars in 2021, and further rising sharply to 667,422 thousand US dollars in 2022. In 2023, revenues decreased slightly to 631,595 thousand US dollars, mirroring a similar pattern observed in net income with recovery post-2020 but some reduction in the most recent year.

Reported Net Profit Margin

The reported net profit margin declined from 64.98% in 2019 to 58.19% in 2020, reflecting the impact of lower net income and revenues in that year. Subsequently, margins improved moderately in 2021 to 59.87%, then increased more substantially to 66.88% in 2022, before contracting slightly to 64.23% in 2023. Overall, profit margins have remained relatively strong, particularly in the last two years.

Adjusted Net Income

Adjusted net income followed a similar trend to net income, starting at 348,392 thousand US dollars in 2019, declining sharply to 181,315 thousand US dollars in 2020. There was a recovery in 2021 to 269,528 thousand US dollars, followed by a significant rise to 453,186 thousand US dollars in 2022. It then declined slightly to 411,499 thousand US dollars in 2023. The adjusted figures suggest that the underlying profitability experienced a similar pattern to reported net income but generally represented higher values.

Adjusted Revenues

Adjusted revenues demonstrate a pattern very close to reported revenues, with a decline from 494,508 thousand US dollars in 2019 to 311,341 thousand US dollars in 2020. This was followed by an increase to 449,048 thousand US dollars in 2021, a notable surge to 669,360 thousand US dollars in 2022, and a modest decrease to 636,735 thousand US dollars in 2023. These adjustments indicate consistency in the overall revenue trend.

Adjusted Net Profit Margin

The adjusted net profit margin declined significantly from 70.45% in 2019 to 58.24% in 2020, mirroring the profits and revenue trends. Margins then improved to 60.02% in 2021, increased more sharply to 67.7% in 2022, and fell slightly to 64.63% in 2023. This indicates that profitability after adjustments remained robust, particularly in the latter two years, reflecting efficient cost management or favorable operating conditions.

Net income trend

Net income exhibited fluctuations over the five-year period. It started at 318,728 thousand US dollars in 2019, dropped significantly to 176,049 thousand in 2020, then rebounded to 269,980 thousand in 2021. Following this recovery, net income increased sharply to a peak of 446,362 thousand in 2022 before declining somewhat to 405,645 thousand in 2023. Overall, the trend shows volatility with a strong recovery and peak in 2022, followed by a moderate decrease the next year.

Total equity movement

Total equity demonstrated a generally upward trajectory throughout the period. From 512,137 thousand US dollars at the end of 2019, it declined slightly to 485,184 thousand in 2020, before gaining momentum with steady increases to 651,711 thousand in 2021, 772,887 thousand in 2022, and reaching 1,043,196 thousand by the end of 2023. This consistent growth over the last three years signifies strengthening capitalization.

Reported return on equity (ROE) pattern

Reported ROE showed a decreasing trend with variability. It was highest in 2019 at 62.23%, then fell sharply to 36.28% in 2020. It rose modestly to 41.43% in 2021 and increased notably to 57.75% in 2022 before declining again to 38.88% in 2023. The return on equity indicates fluctuating profitability relative to equity, with peaks aligning with higher net income years.

Adjusted net income behavior

The adjusted net income mirrored the net income trend, starting at 348,392 thousand US dollars in 2019, dropping to 181,315 thousand in 2020, and nearly stabilizing at 269,528 thousand in 2021. It then surged to 453,186 thousand in 2022 before decreasing slightly to 411,499 thousand in 2023. This similarity confirms that adjustments did not significantly alter the overall income pattern, reflecting persistent underlying earnings volatility.

Adjusted total equity trend

Adjusted total equity also followed a rising trend similar to total equity. From 570,345 thousand in 2019, it declined to 550,180 thousand in 2020, then increased steadily to 715,017 thousand in 2021, 840,434 thousand in 2022, and 1,117,097 thousand in 2023. The consistent upward movement in adjusted equity supports the view of increasing resource base and capitalization strength over the period.

Adjusted ROE evolution

Adjusted return on equity decreased from 61.08% in 2019 to 32.96% in 2020, then experienced a gradual recovery to 37.7% in 2021, followed by a notable increase to 53.92% in 2022. Facing a decline to 36.84% in 2023, the adjusted ROE trend parallels that of the reported ROE, showing similar fluctuations in profitability relative to adjusted equity.

Summary insights

The financial results over the five years reveal cycles of contraction and expansion in profitability, with 2022 as an exceptional year exhibiting peak income and returns. Total equity growth indicates strengthening capital structure despite income volatility. Both reported and adjusted measures confirm consistent patterns, suggesting underlying operational factors affecting profitability while equity base expanded steadily. The declines in profitability ratios in 2023, despite high absolute earnings and equity, point to a relative moderation in return on capital invested.

Over the analyzed five-year period, the company exhibited significant fluctuations in profitability and asset base.

Net Income

The net income initially declined sharply from approximately 319 million in 2019 to 176 million in 2020. This was followed by a recovery and growth phase, climbing to nearly 270 million in 2021, then surging to a peak of around 446 million in 2022, before experiencing a slight decline to 406 million in 2023. Overall, the trend suggests marked volatility with a strong rebound after 2020.

Total Assets

Total assets showed steady growth throughout the period. Starting at around 598 million in 2019, assets slightly decreased to around 572 million in 2020, similar to the net income dip in the same year. Subsequently, assets expanded robustly each year, reaching approximately 1.16 billion by the end of 2023, nearly doubling from the beginning of the period.

Reported Return on Assets (ROA)

The reported ROA mirrored the net income and asset trends but with more pronounced volatility. Beginning with a strong 53.28% in 2019, ROA dropped significantly to 30.8% in 2020. It then recovered partially to approximately 35.33% in 2021 and surged to its highest level of 50.87% in 2022. However, it declined again to 35.08% by 2023. This indicates fluctuating efficiency in utilizing assets to generate net income.

Adjusted Net Income

The adjusted net income followed a similar pattern to the reported net income, with a decrease from 348 million in 2019 to 181 million in 2020, followed by a recovery phase reaching a peak of 453 million in 2022, and a slight decline to 411 million in 2023. The adjusted figures consistently exceeded the reported numbers, suggesting certain adjustments positively affected profitability metrics.

Adjusted Total Assets

Adjusted total assets closely tracked the trend in reported total assets, beginning at 598 million in 2019, dipping marginally in 2020, and then increasing steadily each year to 1.16 billion by 2023. The small adjustments produced values nearly identical to reported totals.

Adjusted Return on Assets (ROA)

The adjusted ROA showed a pattern closely aligned with the reported ROA, displaying a strong initial figure of 58.24% in 2019, a reduction to 31.71% in 2020, a gradual recovery to 35.27% in 2021, a peak of 51.64% in 2022, and a decline to 35.58% in 2023. The adjusted ROA consistently exceeded the reported ROA, indicating adjustments improved the asset profitability measure.

In summary, the data reveal cyclical performance dynamics characterized by a substantial dip in 2020 across profitability and asset efficiency metrics, followed by marked recoveries and growth in subsequent years. The large asset growth from 2021 onwards, coupled with elevated adjusted earnings and ROA in 2022, suggests effective utilization of resources during the recovery period, albeit with some retracement in 2023. The consistent gap between adjusted and reported figures indicates that non-operating factors or accounting treatments significantly influence earnings and return metrics.