TPL Bears Hold Steady as the Stock Slips Below $382

Texas Pacific Land Corporation reports second-quarter earnings today having shed 6% over the past month, with short sellers maintaining elevated positions even as the stock continues to weaken.

Short interest remains near its recent peak. At nearly 19% of the free float — roughly 4.34 million shares as of August 4 — the short position has held broadly flat over the past week after a sharp step-up in late July, when it jumped from around 4.0 million to 4.3 million shares in a single session on July 23. The ORTEX short score has ticked up to 63.0, above where it stood a fortnight ago at 60.3, reflecting sustained negative conviction. Crucially, the borrow market offers no sign of imminent squeeze pressure. Availability runs at 346% — more than three shares available to lend for every one already borrowed — and cost to borrow is just 0.44%. Shorts are committed but not competing for scarce stock. Options traders are similarly unmoved: the put/call ratio of 0.60 is essentially in line with its 20-day average, offering no signal of pre-earnings defensive hedging.

The core debate on TPL has not changed materially since the August 2 preview. Bulls anchor on the land-royalty model: the Permian Basin asset base generates high-margin royalty income that requires little capital and scales cleanly with energy prices. A 40% year-to-date gain through mid-year reflected exactly that thesis. Bears, by contrast, point to valuation that has grown harder to defend as the stock has rolled over. The trailing P/E near 30x and EV/EBITDA around 20x leave limited room for disappointment, particularly with the stock now 6% below where it was a month ago. The mean analyst price target of $443 implies roughly 16% upside from Wednesday's close — but the analyst data is nearly a month old and coverage remains thin, which limits the signal value of that consensus.

One institutional detail is worth noting. Horizon Kinetics, TPL's largest shareholder with roughly 14.7% of shares, has been buying in small daily increments throughout July and into August. These are single-share purchases — symbolic in size but consistent in timing, suggesting the firm has not been deterred by the pullback. That stands in mild contrast to the short sellers adding exposure over the same period.

The earnings print today is less a test of whether TPL's royalty model is intact and more a test of whether management's commentary on Permian activity and water services revenue can justify a multiple that has expanded well ahead of the broader E&P sector — particularly with peers like VNOM and NOG also closing lower on the session.