Value
6.8/10data confidence 83%| Component | Sub-score |
|---|---|
| P/E | 8.1 |
| P/S | 5.2 |
| EV/EBITDA | 5.4 |
| Fwd P/E | 8.7 |
| PEG | 5.7 |
- ▸Forward P/E: 13.0x
- ▸PEG: 1.33
BSM · Why this verdict
Why Black Stone Minerals (BSM) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictHOLD
Overall score5.5/10
ConfidenceMEDIUM
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
Black Stone Minerals is a high-quality mineral-royalty business with 67% margins, 26% ROE and a wide moat, but the price is above the analyst target, insiders sold $28.1M, and its high yield is flagged as unsafe going into earnings tomorrow.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The high yield is flagged as unsafe, with dividend safety scoring 2.2 out of 10, so income holders face payout risk if commodity prices fall. Catalyst breakdown | Dividend safety score rises above 4.0 as free cash flow improves. | ↑Improving |
| CounterMineral royalty partnerships distribute most cash by design, so a low safety score may reflect payout policy rather than financial stress. | ||
52% of the business is tied to oil and condensate, so earnings track oil prices and the thesis is exposed to a commodity downturn. Bear case | Revenue holds up and earnings growth turns positive as oil prices stay supportive. | ↓Deteriorating |
| CounterEarnings growth is already scored 0.0 out of 10, which suggests earnings are not benefiting even in the current environment. | ||
Black Stone earns strong margins of 67% and an excellent ROE of 26% with a wide economic moat, ranking best-in-class for margins among peers. Quality breakdown | Net margin stays above 60% and ROE stays above 20% over 12 months. | →Stable |
| CounterEarnings quality shows a red flag with FCF at only 34% of net income, so reported margins are not fully turning into cash. | ||
Insiders sold $28.1M over 90 days (0.89% of market cap) with no buys, a BEARISH signal that contradicts the high-quality case. Insider | Insider selling slows below 0.3% of market cap over the next two quarters. | →Stable |
| CounterTwo large sales may reflect a single holder's liquidity needs, and the stock still sits above its 200-day average with rising OBV. | ||
Price of $14.85 is above the analyst target of $13.60 (upside -8.4%) and within 4.1% of the 52-week high, with earnings in 1 day. Analyst target | Analysts raise targets above $16 after the 2026-11-02 report. | →Stable |
| CounterWith 5.0% downside to the stop and risk-to-reward of -1.68, a post-earnings reset toward the target is the likelier outcome. | ||
The high yield is flagged as unsafe, with dividend safety scoring 2.2 out of 10, so income holders face payout risk if commodity prices fall.
↑ImprovingCatalyst breakdown
- Expectation
- Dividend safety score rises above 4.0 as free cash flow improves.
CounterMineral royalty partnerships distribute most cash by design, so a low safety score may reflect payout policy rather than financial stress.
52% of the business is tied to oil and condensate, so earnings track oil prices and the thesis is exposed to a commodity downturn.
↓DeterioratingBear case
- Expectation
- Revenue holds up and earnings growth turns positive as oil prices stay supportive.
CounterEarnings growth is already scored 0.0 out of 10, which suggests earnings are not benefiting even in the current environment.
Black Stone earns strong margins of 67% and an excellent ROE of 26% with a wide economic moat, ranking best-in-class for margins among peers.
→StableQuality breakdown
- Expectation
- Net margin stays above 60% and ROE stays above 20% over 12 months.
CounterEarnings quality shows a red flag with FCF at only 34% of net income, so reported margins are not fully turning into cash.
Insiders sold $28.1M over 90 days (0.89% of market cap) with no buys, a BEARISH signal that contradicts the high-quality case.
→StableInsider
- Expectation
- Insider selling slows below 0.3% of market cap over the next two quarters.
CounterTwo large sales may reflect a single holder's liquidity needs, and the stock still sits above its 200-day average with rising OBV.
Price of $14.85 is above the analyst target of $13.60 (upside -8.4%) and within 4.1% of the 52-week high, with earnings in 1 day.
→StableAnalyst target
- Expectation
- Analysts raise targets above $16 after the 2026-11-02 report.
CounterWith 5.0% downside to the stop and risk-to-reward of -1.68, a post-earnings reset toward the target is the likelier outcome.
Per-dimension breakdown
Quality
8.3/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 8.5 |
| ROA | 9.4 |
| Gross margin | 10.0 |
| Op margin | 10.0 |
| Net margin | 10.0 |
| Current ratio | 9.2 |
| FCF quality | 2.7 |
| Moat | 9.0 |
| Rule of 40 | 5.5 |
| Piotroski F | 8.9 |
- ▸Excellent ROE: 26%
- ▸Strong margins: 67%
- ▸Earnings quality RED FLAG: 34% FCF/NI
- ▸Wide economic moat
Growth
2.9/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 5.8 |
| EPS growth | 0.0 |
Momentum
4.7/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 4.0 |
| OBV | 1.0 |
| MA position | 9.0 |
| Volume | 4.2 |
- ▸Volume distribution (falling OBV)
- ▸Above 200-day MA
Sentiment
5.5/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 5.6 |
| Analyst rating | 5.0 |
| Price target | 6.1 |
Insider
3.1/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 2.0 |
| insider conviction | 2.0 |
| holder change | 5.3 |
- ▸Heavy insider selling — $28,099,057 (0.888% of mkt cap)
Peer rank
5.3/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 2.1 |
| quality rank | 9.1 |
| growth rank | 1.7 |
- ▸Superior ROE vs peers
- ▸Best-in-class margins
Technical
5.3/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 3.1 |
| support resistance | 3.1 |
| 52w position | 9.6 |
Risk (lower is worse)
7.4/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 9.1 |
| days to cover | 1.3 |
| volatility | 8.8 |
| put call | 10.0 |
| implied vol | 3.3 |
| beta | 10.0 |
| debt equity | 9.3 |
- ▸Concentration risks: 1 HIGH, 1 MED (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
6.0/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 6.7 |
| earnings timing | 5.0 |
| surprise avg | 9.3 |
| dividend safety | 2.2 |
| news activity | 8.0 |
- ▸Strong earnings: 3B/1M
- ▸Yield trap warning: high yield but unsafe
How the verdict was assembled
Engine trigger
Downgraded from BUY WAIT — price $14.89 vs the analyst target $13.60: -8.7% upside; No upside left.
Engine technical detail
verdict_path:
L4:PATH_E_WIDE_MOAT|SANITY:BUY+upside<=0Passed (5)
- MOMENTUM:4.7>=4.5
- 8K:CLEAN
- EARNINGS_PROXIMITY:110d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- ASYMMETRY:-1.7=NEGATIVE
- INSIDER:0.89%=HEAVY
Warning (1)
- MOMENTUM:4.7<5.5 (soft — BUY_NOW allowed but watch)
Reward-to-Risk
-1.73
Upside
-8.7%
Downside
5.0%
Sizing output
AVOID
SetupRange Bound — RSI 53 mid-range, Bollinger mid-band
EdgeNo clear edge — No clear edge identified
SuitabilityAggressive — MCap $3.2B<$5B
Investment implication
The HOLD_IF_HOLDING verdict reflects the ASYMMETRY gate's -1.7=NEGATIVE outcome against Quality at 8.3 and asymmetric R:R of -1.73.
The strongest dimensions are Quality at 8.3, Risk (lower is worse) at 7.4, and Value at 6.8; the weakest are Growth at 2.9, Insider at 3.1, and Momentum at 4.7. The V9 engine flagged 2 failed gates with 1 warning, producing an asymmetric reward-to-risk of -1.73 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1High Margin Mineral Royalties
Trip ifNet margin falls below 50% from the current 67%.
- P2Oil Commodity Concentration
Trip ifOil and condensate share of revenue exceeds 65% from the current 52%.
- P3Heavy Insider Selling
Trip ifInsider selling exceeds 2% of market cap over 90 days from the current 0.89%.
- P4Price Above Analyst Target
Trip ifShare price falls below $14.35, the stop level, from the current $14.85.
- P5Unsafe High Yield
Trip ifFCF/NI stays below 30% from the current 34% for 2 consecutive quarters.