Key perspective, KeyBanc Analyst believes investors should buy the dip

KeyBanc Capital Markets rated this real estate operating company’s shares “overweight” and maintained a $639 price target, calling a 15.7% single day decline a significant overreaction and a buying opportunity.

The selloff followed the sudden death of Horizon Kinetics Holdings Corp. CEO Murray Stahl on April 7, which the market appeared to interpret as a potential forced-selling risk.

Horizon Kinetics, the largest shareholder in Texas Pacific Land Corp. (NYSE: TPL) with a 15.2% stake, also holds 22.3% of LandBridge and 15.8% of WaterBridge.

TPL traded down on 328% of its 30-day average volume against a -2.3% return for the XOP on the day. LandBridge fell 7% on 200% of average volume, while WaterBridge declined 0.3% on 115% of average volume. Horizon Kinetics itself dropped 12.7% on 416% of its average volume.

KeyBanc said the market was pricing in a worst-case outcome by assuming Horizon Kinetics would face significant investor redemptions and be forced to liquidate TPL shares.

The brokerage rejected that view, pointing to Horizon Kinetics’ announcement that co-founders Steven Bregman and Peter Doyle, both of whom established the firm alongside Stahl in 1994, assumed co-CEO roles following his passing.