Kimbell Royalty (NYSE:KRP) Receives Average Rating of "Hold" from Brokerages

Key Points

• Shares have an average analyst recommendation of Hold from five brokerages (three hold, two buy) with a mean 12‑month target price of $17.33.
• Kimbell beat quarterly estimates—EPS $0.21 vs. $0.14 consensus and revenue $82.45M (+23.7% YoY)—and the board approved a $100 million buyback to repurchase up to 6.4% of outstanding shares.
• The company raised its quarterly dividend to $0.37 (annualized $1.48) for an approximate 10.3% yield, though the payout ratio is very high at 238.7%, raising sustainability concerns.

Shares of Kimbell Royalty (NYSE:KRP - Get Free Report) have earned an average recommendation of "Hold" from the five brokerages that are currently covering the company, Marketbeat reports. Three investment analysts have rated the stock with a hold recommendation and two have given a buy recommendation to the company. The average 12-month target price among brokerages that have issued a report on the stock in the last year is $17.3333.

Several equities analysts recently weighed in on KRP shares. KeyCorp raised shares of Kimbell Royalty from a "sector weight" rating to an "overweight" rating and set a $17.00 price objective on the stock in a research report on Thursday, April 2nd. Mizuho cut their price objective on shares of Kimbell Royalty from $17.00 to $16.00 and set a "neutral" rating on the stock in a research report on Friday, February 27th. Weiss Ratings raised shares of Kimbell Royalty from a "sell (d+)" rating to a "hold (c-)" rating in a research report on Monday, February 2nd. Wall Street Zen lowered shares of Kimbell Royalty from a "buy" rating to a "hold" rating in a research report on Saturday, March 7th. Finally, Citigroup lifted their price target on shares of Kimbell Royalty from $17.00 to $19.00 and gave the company a "buy" rating in a research report on Tuesday, March 31st.

Kimbell Royalty Price Performance

NYSE KRP opened at $14.38 on Friday. The company has a 50 day simple moving average of $14.32 and a 200-day simple moving average of $13.30. The company has a debt-to-equity ratio of 0.72, a current ratio of 8.64 and a quick ratio of 8.64. The firm has a market capitalization of $1.55 billion, a price-to-earnings ratio of 23.19, a price-to-earnings-growth ratio of 2.96 and a beta of 0.29. Kimbell Royalty has a 52-week low of $11.31 and a 52-week high of $15.12.

Kimbell Royalty (NYSE:KRP - Get Free Report) last issued its quarterly earnings data on Thursday, February 26th. The energy company reported $0.21 earnings per share for the quarter, beating the consensus estimate of $0.14 by $0.07. The firm had revenue of $82.45 million for the quarter, compared to analyst estimates of $76.78 million. Kimbell Royalty had a net margin of 26.43% and a return on equity of 13.73%. The company's revenue for the quarter was up 23.7% on a year-over-year basis. During the same quarter last year, the firm earned ($0.48) earnings per share. Equities research analysts predict that Kimbell Royalty will post 0.65 earnings per share for the current fiscal year.

Kimbell Royalty declared that its board has approved a share buyback plan on Monday, March 9th that permits the company to repurchase $100.00 million in outstanding shares. This repurchase authorization permits the energy company to reacquire up to 6.4% of its shares through open market purchases. Shares repurchase plans are typically an indication that the company's leadership believes its stock is undervalued.

Kimbell Royalty Increases Dividend

The company also recently declared a quarterly dividend, which was paid on Wednesday, March 25th. Stockholders of record on Wednesday, March 18th were given a $0.37 dividend. This is a positive change from Kimbell Royalty's previous quarterly dividend of $0.35. This represents a $1.48 dividend on an annualized basis and a dividend yield of 10.3%. The ex-dividend date of this dividend was Wednesday, March 18th. Kimbell Royalty's payout ratio is 238.71%.

Insider Activity at Kimbell Royalty

In other news, insider Blayne Rhynsburger sold 6,609 shares of Kimbell Royalty stock in a transaction that occurred on Monday, March 23rd. The shares were sold at an average price of $14.48, for a total value of $95,698.32. Following the transaction, the insider owned 75,163 shares of the company's stock, valued at $1,088,360.24. This trade represents a 8.08% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. 5.60% of the stock is currently owned by corporate insiders.

Hedge Funds Weigh In On Kimbell Royalty

A number of institutional investors have recently modified their holdings of the company. American Century Companies Inc. raised its position in shares of Kimbell Royalty by 9.2% in the third quarter. American Century Companies Inc. now owns 3,026,429 shares of the energy company's stock valued at $40,827,000 after purchasing an additional 255,688 shares during the period. Adage Capital Partners GP L.L.C. grew its stake in shares of Kimbell Royalty by 32.1% in the fourth quarter. Adage Capital Partners GP L.L.C. now owns 1,210,948 shares of the energy company's stock worth $14,241,000 after acquiring an additional 294,482 shares during the last quarter. UBS Group AG grew its stake in shares of Kimbell Royalty by 9.4% in the fourth quarter. UBS Group AG now owns 1,009,057 shares of the energy company's stock worth $11,867,000 after acquiring an additional 86,957 shares during the last quarter. Energy Income Partners LLC grew its stake in shares of Kimbell Royalty by 12.3% in the third quarter. Energy Income Partners LLC now owns 647,396 shares of the energy company's stock worth $8,733,000 after acquiring an additional 70,783 shares during the last quarter. Finally, Pin Oak Investment Advisors Inc. grew its stake in shares of Kimbell Royalty by 0.9% in the third quarter. Pin Oak Investment Advisors Inc. now owns 618,128 shares of the energy company's stock worth $8,339,000 after acquiring an additional 5,213 shares during the last quarter. Institutional investors own 25.78% of the company's stock.

About Kimbell Royalty

Kimbell Royalty Partners LP NYSE: KRP is a mineral and royalty company focused on acquiring and managing oil and natural gas royalty interests in the United States. As a master limited partnership, Kimbell Royalty generates fee-like revenues by collecting royalties and overriding royalty interests on production volumes, without directly bearing the capital or operating costs of drilling and completion activities. The partnership's business model emphasizes steady cash flows and limited downside exposure to commodity price fluctuations.

The company's asset portfolio spans multiple onshore basins, with a core concentration in Texas and New Mexico.

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