Buffett Brain · Research note
Score updated 26 Sept 2026 · analysis from 10 Jun 2026
BSM· Energy
Black Stone Minerals, L.P.
Black Stone Minerals boasts a 27.7% ROIC and 78% gross margin, positioning it as a top-quintile player in the energy sector with a strong economic moat.
Buffett fit
Strong fit
Owner
95
Durability
60
Management
76
Price
96
Score updated 26 Sept 2026 · analysis from 10 Jun 2026
Buffett's checklist
Each number against Buffett's bar, and where it ranks among Energy stocks in our database.
How much profit the business makes on each dollar invested in it. Higher is better.
What is left of each sale after the cost of making the product. A high number often means pricing power.
The cash the business earns for its owners, compared with the price of the whole company.
How fast sales grew each year over the last five years.
How many years of today's profit you pay for at today's price. Lower means cheaper.
How much the company owes compared with what it owns outright. Lower is safer.
The four pillars
How the business measures up on each of Buffett's four tests.
If I owned 100% of Black Stone Minerals, I would expect to see stable cash flows from its mineral interests over the next decade, with a potential for growth in earnings driven by rising commodity prices.
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Over the next ten years, I see Black Stone Minerals maintaining its profitability, especially given its 63.5% net margin and 27.7% , both of which are well above the sector's top-quintile thresholds.
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Management has demonstrated a commitment to shareholder returns, reflected in a low share count CAGR of 0.42% and a high dividend yield of 8.97%.
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With an earnings yield of 10.46% and a of 9.6, the valuation appears attractive compared to the 8-10% target for yield.
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For and against
The strongest points on each side, with the numbers behind them.
In its favor
5- 1 of 27.7% exceeds the sector's top-quintile cutoff of 10.4%.
- 2 of 78% is well above the sector's 51.2% threshold.
- 3Net margin of 63.5% ranks in the top quintile compared to the sector's 21.7%.
- 4Low ratio of 0.17 indicates financial stability.
Concerns
5- 1Revenue CAGR over the last 5 years is -4.41%, indicating potential challenges in growth.
- 2 YoY growth of -22.46% raises questions about cash flow sustainability.
- 3EPS max decline of 39.79% over the past 5 years could signal volatility.
- 4Minimal yield of 0.13% suggests limited capital return strategies.
Price history
$14.59+19.9%· 5-year return
Weekly closing prices. Touch or hover the line for a date.
The business
How the business works
Black Stone Minerals owns mineral interests in 16.8 million gross acres, generating revenue primarily from oil and natural gas royalties. In the last twelve months, the company reported $422.33 million in revenue with a net income of $299.93 million. The business model benefits from minimal capital requirements, allowing it to focus on profitability.
How this analysis has moved
The call has held across 5 reviews.
Sep 27, 2026 → Oct 22, 2026
What other investors would say
The same company, judged by three other documented playbooks.
Keep researching
Similar companies in Energy
Questions about Black Stone Minerals, L.P.
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