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1. Company Snapshot

1.a. Company Description

Black Stone Minerals, L.P., together with its subsidiaries, owns and manages oil and natural gas mineral interests.It owns mineral interests in approximately 16.8 million gross acres, nonparticipating royalty interests in 1.8 million gross acres, and overriding royalty interests in 1.7 million gross acres located in 41 states in the United States.As of December 31, 2021, the company had a total estimated proved oil and natural gas reserves of 59,824 barrels of oil equivalent.


Black Stone Minerals, L.P. was founded in 1876 and is based in Houston, Texas.

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1.b. Last Insights on BSM

Black Stone Minerals' recent performance was driven by its strong Q4 2024 earnings, with a 2% production increase expected in 2025, primarily due to new wells and rising natural gas prices. The company maintained a distribution coverage greater than 1x distributable cash flow throughout 2024, and its renegotiated production agreement with Aethon is expected to boost earnings. Additionally, Black Stone Minerals' robust hedging program and improving natural gas prices have contributed to its positive outlook.

1.c. Company Highlights

2. Strong Q4 Earnings with Growth Momentum

The company's financial performance for the fourth quarter was robust, with net income of $72.2 million and adjusted EBITDA of $76.7 million. Earnings per share (EPS) came in at $0.31, beating analyst estimates of $0.27. The distribution declared for the quarter was $0.30 per unit, with a distribution coverage of 1.05x, indicating a healthy ability to cover the distribution. Revenue growth is expected to continue, with analysts estimating a 10.7% increase in revenues for the next year.

Publication Date: Feb -25

📋 Highlights
  • Development Agreements:: 500,000 gross acres secured with Revenant and Caturus Energy for future production.
  • Acquisition Program:: $240M invested since 2023 in Shelby Trough and Haynesville expansion acreage.
  • 2025 Production:: Ended year at 32,000 BOE/day, with significant 2026 growth expected from new agreements.
  • Q4 Financials:: Net income of $72.2M and adjusted EBITDA of $76.7M, with 1.05x distribution coverage.

Operational Highlights

The company achieved significant commercial milestones in 2025, including development agreements with Revenant Energy and Caturus Energy, which placed approximately 500,000 gross acres into development. The acquisition program remains on track, with $240 million invested since launching in '23 to add accretive mineral and royalty acreage across the Shelby Trough and Haynesville expansion area. Production ended 2025 at 32,000 BOE per day, with expectations of material growth throughout 2026, driven by new development agreements and high-interest developments in the Permian Basin.

Growth Prospects

The company is confident in its ability to fund its distribution and grow throughout the year based on its development agreements and minimum commitments. Strong hedges are in place for natural gas throughout the year, and the company's significant assets near Gulf Coast LNG facilities position it to benefit from the substantial call on gas supply. As stated by the company, "We're excited about the growing demand for natural gas and our significant assets near Gulf Coast LNG facilities position us to benefit from the substantial call on gas supply."

Valuation

With a P/E Ratio of 10.76 and an EV/EBITDA of 10.78, the company's valuation appears reasonable. The Dividend Yield stands at 8.37%, which is attractive for income-seeking investors. The ROE of 29.11% and ROIC of 19.89% indicate strong profitability. The Net Debt / EBITDA ratio is -0.0, suggesting a healthy debt position. Overall, the valuation metrics suggest that the company's growth prospects are reasonably priced in.

3. NewsRoom

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Black Stone Minerals: Expecting Production To Ramp Back Up During 2026 (Rating Downgrade)

Feb -28

Source: seekingalpha.com

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Black Stone Minerals, L.P. Common Units (BSM) Q4 2025 Earnings Call Transcript

Feb -24

Source: seekingalpha.com

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Chase Investment Counsel Corp Acquires 40,663 Shares of Black Stone Minerals, L.P. $BSM

Feb -24

Source: defenseworld.net

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Compared to Estimates, Black Stone Minerals (BSM) Q4 Earnings: A Look at Key Metrics

Feb -24

Source: zacks.com

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Black Stone Minerals, L.P. Announces Fourth Quarter and Full Year 2025 Results; Provides Guidance for 2026

Feb -23

Source: businesswire.com

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Ahead of Black Stone Minerals (BSM) Q4 Earnings: Get Ready With Wall Street Estimates for Key Metrics

Feb -18

Source: zacks.com

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Black Stone Minerals, L.P. Announces Distribution and Schedules Earnings Call to Discuss Fourth Quarter and Full-Year 2025 Results

Feb -04

Source: businesswire.com

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Americana Partners LLC Makes New $532,000 Investment in Black Stone Minerals, L.P. $BSM

Jan -22

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (15.50%)

6. Segments

Oil & Gas - Exploration & Production

Expected Growth: 8.0%

The segment is expected to grow due to the company's ongoing drilling and completion efforts, which are expected to increase production volumes and drive revenue growth, despite potential volatility in commodity prices.

7. Detailed Products

Oil and Natural Gas Properties

Black Stone Minerals, L.P. owns and operates oil and natural gas properties across the United States, with a focus on the Permian, Bakken, and Eagle Ford shale plays.

Royalty and Mineral Interests

The company owns a significant portfolio of royalty and mineral interests in oil and natural gas properties, entitling it to a percentage of the revenue generated from the production of oil and natural gas on those properties.

Acquisitions and Divestitures

Black Stone Minerals, L.P. engages in the acquisition and divestiture of oil and natural gas properties, as well as royalty and mineral interests.

Exploration and Production (E&P) Services

Black Stone Minerals, L.P. provides E&P services, including drilling, completion, and production operations, to support the development of its oil and natural gas properties.

Midstream Services

The company provides midstream services, including gathering, processing, and transportation of oil and natural gas, to support the development and production of its properties.

8. Black Stone Minerals, L.P.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Black Stone Minerals, L.P. is medium as there are limited alternatives for the company's products and services.

Bargaining Power Of Customers

The bargaining power of customers for Black Stone Minerals, L.P. is low as the company operates in a niche market with limited customer concentration.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Black Stone Minerals, L.P. is medium as the company relies on a few key suppliers for its operations.

Threat Of New Entrants

The threat of new entrants for Black Stone Minerals, L.P. is low as the company operates in a highly regulated industry with significant barriers to entry.

Intensity Of Rivalry

The intensity of rivalry for Black Stone Minerals, L.P. is high as the company operates in a highly competitive industry with several established players.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 2.93%
Debt Cost 12.44%
Equity Weight 97.07%
Equity Cost 5.92%
WACC 6.11%
Leverage 3.02%

11. Quality Control: Black Stone Minerals, L.P. passed 7 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Coterra Energy

A-Score: 6.9/10

Value: 7.0

Growth: 4.4

Quality: 7.6

Yield: 9.0

Momentum: 5.5

Volatility: 7.7

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Black Stone Minerals

A-Score: 6.5/10

Value: 5.5

Growth: 3.7

Quality: 7.9

Yield: 10.0

Momentum: 2.5

Volatility: 9.3

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Kimbell Royalty Partners

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Value: 5.3

Growth: 3.7

Quality: 6.2

Yield: 10.0

Momentum: 2.5

Volatility: 8.7

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Civitas Resources

A-Score: 6.1/10

Value: 9.5

Growth: 6.1

Quality: 6.7

Yield: 10.0

Momentum: 1.0

Volatility: 3.0

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Murphy Oil

A-Score: 5.8/10

Value: 7.9

Growth: 4.6

Quality: 6.1

Yield: 7.0

Momentum: 5.0

Volatility: 4.3

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Ovintiv

A-Score: 4.9/10

Value: 6.1

Growth: 4.1

Quality: 4.5

Yield: 5.0

Momentum: 4.5

Volatility: 5.3

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

14.95$

Current Price

14.95$

Potential

-0.00%

Expected Cash-Flows