Name: Chadd Garcia drills into LandBridge's value
Uploaded: 2026-04-26T12:17:48+00:00
Duration: 3712 s

Speakers

Chad Garcia — Host, "Thinking Crypto

Andrew Walker — Host, Yet Another Value Blog

Summary

Chad Garcia returns to discuss LandBridge, the Permian land royalty and pore space business, and why he thinks it is undervalued versus TPL. The conversation covers LandBridge's water and surface-use royalties, produced-water infrastructure, acquisition strategy, sponsor structure, and the potential data center/power option in West Texas. They also update Secure Energy's takeover by GFL and the broader produced-water/waste re-rating thesis, with Chad preferring LandBridge over WaterBridge at current prices.

Chad argues LandBridge's royalty-like pore space cash flows are underappreciated.
LandBridge trades at a discount to TPL despite higher-quality growth.
WaterBridge offers double-digit growth and potential municipal-waste re-rate.
Secure Energy's GFL buyout validates the waste infrastructure thesis but price is debated.
GFL should benefit from Secure's growth and capital allocation opportunities.
Permian data centers remain a free option pending hyperscaler contracts.
Related-party structure and sponsor ownership are key debate points.

Ideas

Chad Garcia Host, "Thinking Crypto 13:21

Mispriced Permian royalty growth compounder.

LandBridge owns surface rights and pore space across the Permian and earns royalty-like revenue from produced water, source water, and surface use. Chad thinks the market is underappreciating the growth: it has over 7.5M bbl/day of incremental pore space, management sees 5M bbl/day added over five years at 15 cents/bbl with no incremental expense, potentially driving 25%-35% FCF CAGR. It trades around 20-22x EBITDA versus TPL at 28-31x, active land management has lifted acquired FCF (2024 acquisitions +150% in 2025), and data centers are a free option; fair value could be triple digits if TPL-like multiples are applied.

Chad Garcia Host, "Thinking Crypto 16:11

TPL too expensive versus LandBridge.

TPL's mineral royalties are lower-quality, depleting, and commodity-sensitive, while it trades at a premium to LandBridge (28-31x EBITDA versus 20-22x). After marking TPL's vast mineral package at PrairieSky-like 16x and LandBridge's at Venom-like 10x, TPL's remaining produced water, source water, and surface easement business is valued around 50x EBITDA, leaving a roughly 20-turn spread. Chad attributes the premium partly to long-term holders and Horizon Kinetics, but views LandBridge as the better risk/reward.

Chad Garcia Host, "Thinking Crypto 27:20

WaterBridge offers re-rate and double-digit growth.

WaterBridge is the produced-water infrastructure company tied to LandBridge; Chad owns both but prefers LandBridge. WaterBridge should compound at double-digit rates from announced projects, with potential to add about 1M bbl/day of incremental water flow per year, and could re-rate if investors value produced-water waste infrastructure like municipal waste companies, a thesis validated by Waste Connections' interest and Secure's takeover. It also benefits as the operating partner to LandBridge's pore space.

Chad Garcia Host, "Thinking Crypto 51:18

Secure is undervalued waste infrastructure play.

Secure Energy/Secure Waste Infrastructure has transformed from an energy services company into a waste infrastructure business with recurring waste streams, long-term contracts, and higher margins and ROCs than municipal waste peers because it lacks expensive truck collection assets. GFL's buyout at about 11x EBITDA undervalues it versus municipal waste comps around 15x; Abrams Capital is opposing the deal, and Chad thinks the price is too cheap, though he is still deciding how to vote. This supports the produced-water/waste re-rating thesis.

Chad Garcia Host, "Thinking Crypto 54:26

GFL gains growth from Secure acquisition.

As a GFL shareholder, Chad thinks buying Secure brings GFL a business with both price and volume growth, tuck-in and greenfield/brownfield opportunities, and higher margins and ROCs. The deal should be margin- and ROC-accretive, and GFL's capital allocation skill could let it divest Secure's pipeline segment to fund buybacks.

Chadd Garcia drills into LandBridge's value

Summary

Ideas

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