Texas Pacific Land (TPL) Showing Signs Of Being Strong And Under The Radar

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Texas Pacific Land ( TPL) as a strong and under the radar candidate. In addition to specific proprietary factors, Trade-Ideas identified Texas Pacific Land as such a stock due to the following factors:

  • TPL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $3.0 million.
  • TPL is making at least a new 3-day high.
  • TPL has a PE ratio of 49.9.
  • TPL is mentioned 0.35 times per day on StockTwits.
  • TPL has not yet been mentioned on StockTwits today.
  • TPL is currently in the upper 20% of its 1-year range.
  • TPL is in the upper 35% of its 20-day range.
  • TPL is in the upper 45% of its 5-day range.
  • TPL is currently trading above yesterday's high.

'Strong and Under the Radar' stocks tend to be worthwhile stocks to watch for a variety of factors including historical back testing and price action. Market technicians refer to such stocks as being in an accumulation phase before a mark-up and peak. Traders and hedge funds have frequently found that these types of stocks continue to build a solid price base and then ultimately spike higher and peak when others 'discover' how good the stock is performing. By leveraging the social discovery aspect of StockTwits we are highlighting stocks that don't currently receive much attention from retail investors, but we suspect may soon garner more attention.

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More details on TPL:

Texas Pacific Land Trust holds title to tracts of land in the state of Texas. It manages these lands for the benefit of the holders of Certificates of Proprietary Interest in the Trust. The company is also involved in the sale of land, oil and gas royalties, and grazing leases of the land. The stock currently has a dividend yield of 0.1%. TPL has a PE ratio of 49.9.

The average volume for Texas Pacific Land has been 12,400 shares per day over the past 30 days. Texas Pacific has a market cap of $1.7 billion and is part of the financial sector and real estate industry. The stock has a beta of 1.06 and a short float of 0.1% with 0.63 days to cover. Shares are up 99.5% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Texas Pacific Land as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, reasonable valuation levels and expanding profit margins. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.

Highlights from the ratings report include:
  • TPL's very impressive revenue growth greatly exceeded the industry average of 11.3%. Since the same quarter one year prior, revenues leaped by 56.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • TPL has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Diversified Financial Services industry and the overall market, TEXAS PACIFIC LAND TRUST's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • The gross profit margin for TEXAS PACIFIC LAND TRUST is currently very high, coming in at 94.45%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 63.64% significantly outperformed against the industry average.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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