Kimbell Royalty Partners LP Dossier - Source-backed chat

Kimbell Royalty Partners LP

KRPNYSE

SectorEnergy

IndustryOil & Gas E&P

Beta (adjusted)0.54

Intrinsic Value $24.67median of 5 methods · middle span $15-$35based on filings through 30 Jun 2026

Market Price $14.46Price as of 1 Oct 2026

Significantly undervaluedIntrinsic value is 71% above the market price

−50% · IV below pricenear fair value ±15%IV above price · +50%

marker beyond scale (+71%)

Data confidence Sign in to view data confidence

Market Cap $1.9B

Enterprise Value $2.3B

Shares Outstanding 128.5M diluted

Moat Rating Wide

Next Earnings Date5 Nov 2026

Last ex-dividend17 Aug 2026

All prices and values are periodic snapshots, not live quotes. Source dates are shown for reference.

Thesis

Street consensus, scenarios, merits, risks, and invalidation triggers

AI-assisted

Thesis Summary

Kimbell Royalty Partners, LP (NYSE: KRP) presents a compelling high-yield investment opportunity, currently yielding approximately 11% based on its Q1 2026 distribution of $0.41 per unit. Operating under an asset-light, low-cost mineral and royalty ownership model, KRP avoids direct capital expenditure and operational risks while maintaining senior positioning in the capital structure. The partnership's extensive geographic footprint spans over 17 million gross acres across 28 states, capturing active drilling from top-tier operators. Despite a Q1 2026 earnings miss driven by non-cash derivative losses, operational metrics remain robust with 85 active rigs on its acreage (representing ~16% of the U.S. land rig count). The pending $147 million acquisition of Permian Basin assets from Mesa Royalties is expected to be immediately accretive, adding ~1,390 Boe/d of high-margin production and reinforcing KRP's role as a natural consolidator in a highly fragmented market.

This section is the 12-month view: analyst targets and the probability-weighted scenarios built from them. The intrinsic value at the top of this page answers a different question: what the business is worth today.

Street view · analyst 12-month targets5 analysts · as of 18 Aug 2026

Low · most bearish analyst$17.00

Mean target$19.20

High · most bullish analyst$23.00

Our research · scenarios, merits, risks, and invalidation triggersResearch as of 18 Sep 2026

Scenarios · 12-month scenario targetsAnchored at research date

Bear CaseDownside scenario

$17.0020%

A sharp decline in global crude oil and natural gas prices, combined with a slowdown in operator drilling activity, reduces royalty revenues. Delayed completions of DUCs on KRP's acreage and higher-than-expected pass-through costs squeeze distributable cash flow. Thin distribution coverage forces a reduction in the quarterly payout, leading to unit price depreciation as income-focused investors exit.

Base CaseCentral scenario

$19.2050%

Matches the consensus mean

KRP successfully integrates the Mesa Royalties acquisition, maintaining stable run-rate production within its guided range of 24,000 to 27,000 Boe/d. The partnership continues to distribute 75% of cash available for distribution, yielding a stable 10.5% to 11.2% annualized return. Moderate commodity prices and disciplined G&A management support a steady valuation in line with historical averages.

Bull CaseUpside scenario

$23.0030%

Sustained elevated commodity prices (WTI crude near $100/bbl) and rapid integration of the $147 million Mesa Royalties acquisition drive significant cash flow accretion. Strong organic drilling activity from operators in the Permian Basin and rising natural gas demand from power grids supporting AI data centers accelerate production volumes beyond the high end of guidance. This supports an annualized distribution exceeding $1.96 per unit, driving yield expansion and multiple rerating.

Scenarios are anchored to street consensus at the research date, with our probabilities and rationale.

Key Investment Merits

Asset-light business model with zero capital expenditure requirements and no direct operational liabilities.
Highly diversified portfolio covering over 17 million gross acres across all major onshore U.S. basins, reducing regional operational risk.
Strong income generation with an ~11% annualized yield, supported by a disciplined 75% payout ratio and tax-advantaged return of capital treatment.
Active consolidation strategy, highlighted by the accretive $147 million Permian Basin acquisition from Mesa Royalties.

Key Investment Risks

Direct sensitivity of cash distributions to volatile global oil and natural gas market prices.
Dependence on third-party operators for all drilling, development, and production activities on KRP's acreage.
Potential distribution coverage pressure if commodity prices decline or derivative hedging losses persist.
Natural decline rates of existing oil and gas wells requiring continuous acquisition of new mineral interests to sustain production.

Thesis Invalidation Triggers

A sustained drop in WTI crude oil prices below $60/bbl or natural gas below $1.50/mcf, severely impacting cash available for distribution.
A significant reduction in active rig counts on KRP's acreage below 60 rigs, indicating a pullback in operator capital allocation.
Failure to close or successfully integrate the Mesa Royalties acquisition, or if the acquired assets deliver production significantly below the projected 1,390 Boe/d.

All scenarios are estimates and subject to change. Past performance is not indicative of future results.

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Explore this dossier

ValuationIntrinsic value, the six-method breakdown, peer medians, and your assumptions sandbox.Financial SnapshotRevenue, profitability, returns, balance sheet, dividends, and the filing-level detail.Qualitative AnalysisBusiness overview, strategic initiatives, and mergers, acquisitions & partnerships.Outlook & Key DatesForward estimates, reporting calendar, and the monitoring framework.