Chadd Garcia joins the five timers club and talks about his investment thesis for WaterBridge (WBI). WaterBridge is a recent IPO that manages water from oil drilling, largely in the Permian Basin. Chadd's spent a lot of time on oil services and infrastructure, and he breaks down how this investment relates to prior investments in LandBridge, Texas Pacific, and Secure. He also talks about the opportunity for growth and pricing power at WaterBridge. __________________________________________________________ [00:00:00] Podcast intro and Chad returns [00:02:24] WaterBridge’s core operations explained [00:04:41] Pipelines and disposal network details [00:06:03] Missed waste parallels in analysis [00:10:52] Valuation setup and contract pricing [00:13:04] 2025 EBITDA forecast discussed [00:14:45] Scalability from current infrastructure [00:15:37] Infrastructure ROICs and economics [00:17:33] Land ownership and strategic value [00:19:05] WaterBridge vs. LandBridge relationship [00:22:25] Why Devon partners with WaterBridge [00:27:35] Sponsor structure and conflict resolution [00:29:30] Regulatory risk and permitting update [00:33:39] Permian basin long-term outlook [00:35:10] Increasing water cuts impact volumes [00:36:41] Oil price sensitivity and volume trends [00:38:03] Organic growth via MVC contracts [00:39:11] Maintenance capex benchmarking [00:41:40] Capital allocation and future returns [00:42:31] Waste comps and multiple discussion [00:45:49] Terminal value and ROIC comparisons [00:47:57] Key risks: spills and short reports [00:49:12] Environmental downside vs. oil spills [00:51:25] Short reports and perceived conflicts [00:52:21] Why WaterBridge and LandBridge are separate [00:53:08] Investor day importance and growth [00:54:10] Chad’s visibility helps spread thesis [00:56:54] Housing workers for Texas data center boom Links: Yet Another Value Blog - https://www.yetanothervalueblog.com See our legal disclaimer here: https://www.yetanothervalueblog.com/p/legal-and-disclaimer
