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Sabine Royalty Trust
Royalty trusts / Royalty Trust in Oil
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The Sabine Royalty Trust is a publicly traded trust that was formed in 1982. The trust holds overriding royalty interests, or rights to a portion of the proceeds from the production of oil, gas, and other minerals, in various properties primarily located in Texas, Louisiana, and Mississippi.
The trust’s portfolio includes interests in approximately 2.5 million gross acres, with over 47,000 net royalty acres. The trust’s royalty interests are leased to oil and gas companies who pay monthly royalties based on production from the properties.
The trust is managed by a trustee and a team of professionals who oversee the collection and distribution of royalty payments to unit holders. Unit holders, who are typically individuals and institutions, own a pro rata share of the trust’s royalty interests.
The trust’s main source of income is the royalties received from oil and gas production, and the trust provides regular distributions to unit holders on a monthly basis. The amount of the distributions can vary based on numerous factors, including the prices of oil and gas, the production levels of the underlying properties, and the trust’s expenses.
The trust is a popular investment choice for individuals seeking exposure to the oil and gas industry without the risks and costs associated with direct ownership of mineral rights. The trust also provides income diversification for unit holders, as the trust’s royalty interests are spread across numerous properties and operators.
Overall, the Sabine Royalty Trust is a reputable company with a long history of providing consistent returns to its unit holders through the collection and distribution of royalty payments.
The trust’s portfolio includes interests in approximately 2.5 million gross acres, with over 47,000 net royalty acres. The trust’s royalty interests are leased to oil and gas companies who pay monthly royalties based on production from the properties.
The trust is managed by a trustee and a team of professionals who oversee the collection and distribution of royalty payments to unit holders. Unit holders, who are typically individuals and institutions, own a pro rata share of the trust’s royalty interests.
The trust’s main source of income is the royalties received from oil and gas production, and the trust provides regular distributions to unit holders on a monthly basis. The amount of the distributions can vary based on numerous factors, including the prices of oil and gas, the production levels of the underlying properties, and the trust’s expenses.
The trust is a popular investment choice for individuals seeking exposure to the oil and gas industry without the risks and costs associated with direct ownership of mineral rights. The trust also provides income diversification for unit holders, as the trust’s royalty interests are spread across numerous properties and operators.
Overall, the Sabine Royalty Trust is a reputable company with a long history of providing consistent returns to its unit holders through the collection and distribution of royalty payments.
What is special about the company?
There are a few characteristics that make the Sabine Royalty Trust company unique:
1. Trust Structure: Sabine Royalty Trust is a unique entity in that it is a trust rather than a traditional corporation. This means that the company is managed by a trustee who is responsible for distributing income from oil and gas royalties to the trust’s unitholders (or shareholders).
2. Royalty-Focused: The company’s primary source of income comes from oil and gas royalties on properties in Louisiana, Texas, and Mississippi. This focus on royalty income sets Sabine Royalty Trust apart from other energy companies that may be involved in exploration and production activities.
3. Consistent Dividend Payouts: As a trust, Sabine Royalty Trust is required to distribute most of its income to unitholders in the form of dividends. The trust has a history of consistently paying out dividends, making it an attractive investment for those seeking regular income.
4. Limited Expenses: Unlike traditional corporations, Sabine Royalty Trust has relatively low operating expenses. This is because the trust does not engage in exploration or production activities, and its only significant expense is the trustee’s compensation.
5. Long-Lasting Assets: The trust’s royalty interests in oil and gas properties can generate income for many years, making Sabine Royalty Trust a long-term investment option.
6. Tax Benefits: Trusts such as Sabine Royalty Trust may have favorable tax structures that can benefit unitholders. For example, the trust’s income is only taxed once at the individual investor level, rather than at the corporate and individual levels, as is the case with traditional corporations. This can result in lower tax payments for investors.
Overall, the Sabine Royalty Trust’s trust structure, focus on royalties, consistent dividends, limited expenses, long-lasting assets, and potential tax benefits make it a unique company in the energy industry.
1. Trust Structure: Sabine Royalty Trust is a unique entity in that it is a trust rather than a traditional corporation. This means that the company is managed by a trustee who is responsible for distributing income from oil and gas royalties to the trust’s unitholders (or shareholders).
2. Royalty-Focused: The company’s primary source of income comes from oil and gas royalties on properties in Louisiana, Texas, and Mississippi. This focus on royalty income sets Sabine Royalty Trust apart from other energy companies that may be involved in exploration and production activities.
3. Consistent Dividend Payouts: As a trust, Sabine Royalty Trust is required to distribute most of its income to unitholders in the form of dividends. The trust has a history of consistently paying out dividends, making it an attractive investment for those seeking regular income.
4. Limited Expenses: Unlike traditional corporations, Sabine Royalty Trust has relatively low operating expenses. This is because the trust does not engage in exploration or production activities, and its only significant expense is the trustee’s compensation.
5. Long-Lasting Assets: The trust’s royalty interests in oil and gas properties can generate income for many years, making Sabine Royalty Trust a long-term investment option.
6. Tax Benefits: Trusts such as Sabine Royalty Trust may have favorable tax structures that can benefit unitholders. For example, the trust’s income is only taxed once at the individual investor level, rather than at the corporate and individual levels, as is the case with traditional corporations. This can result in lower tax payments for investors.
Overall, the Sabine Royalty Trust’s trust structure, focus on royalties, consistent dividends, limited expenses, long-lasting assets, and potential tax benefits make it a unique company in the energy industry.
What the company's business model?
The Sabine Royalty Trust is a publicly traded company that operates as a royalty-based trust. Its primary business is collecting and distributing income from oil and gas properties located primarily in Texas, Louisiana, Mississippi, New Mexico, Oklahoma, and Alabama. The company’s business model involves owning royalty rights to natural gas and crude oil reserves, which are managed and operated by various independent oil and gas companies. Sabine Royalty Trust earns income from its royalty interests, which are distributed to trust unit holders on a monthly basis. The company does not engage in exploration, drilling, or production activities, but instead relies on the production and sale of oil and gas by the operators of the properties in which it holds royalty interests.
Interesting facts about the company
1. The Sabine Royalty Trust is a publicly traded trust formed in 1982 by the Sabine Corporation. It is based in Dallas, Texas and trades under the ticker symbol SBR on the New York Stock Exchange.
2. The trust was created to hold royalty interests in oil and gas properties located in the Sabine River Basin in Texas and Louisiana.
3. The Sabine Royalty Trust receives income from the production of oil, gas, and other minerals on the properties it holds royalty interests in.
4. The trust is managed by NCM Financial Corporation, a subsidiary of BBVA Compass, under the direction of a board of trustees.
5. The Sabine Royalty Trust is unique in that it is a perpetual trust, meaning it has no set expiration date and will continue generating income for beneficiaries for as long as the properties it holds rights to produce.
6. As of 2021, the trust has paid out over $1 billion in distributions to its beneficiaries since its inception.
7. The trust has been listed on the New York Stock Exchange for over three decades and has consistently generated stable returns for its investors.
8. The Sabine Royalty Trust is one of the oldest and largest publicly traded royalty trusts in the United States.
9. The trust has been recognized for its commitment to corporate responsibility, receiving the Silver Award from The Better Business Bureau for its philanthropic efforts.
10. The Sabine Royalty Trust has a diverse portfolio of assets, including royalty rights to oil and gas properties, land interests, and a stake in the Texas City Industrial Complex.
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2. The trust was created to hold royalty interests in oil and gas properties located in the Sabine River Basin in Texas and Louisiana.
3. The Sabine Royalty Trust receives income from the production of oil, gas, and other minerals on the properties it holds royalty interests in.
4. The trust is managed by NCM Financial Corporation, a subsidiary of BBVA Compass, under the direction of a board of trustees.
5. The Sabine Royalty Trust is unique in that it is a perpetual trust, meaning it has no set expiration date and will continue generating income for beneficiaries for as long as the properties it holds rights to produce.
6. As of 2021, the trust has paid out over $1 billion in distributions to its beneficiaries since its inception.
7. The trust has been listed on the New York Stock Exchange for over three decades and has consistently generated stable returns for its investors.
8. The Sabine Royalty Trust is one of the oldest and largest publicly traded royalty trusts in the United States.
9. The trust has been recognized for its commitment to corporate responsibility, receiving the Silver Award from The Better Business Bureau for its philanthropic efforts.
10. The Sabine Royalty Trust has a diverse portfolio of assets, including royalty rights to oil and gas properties, land interests, and a stake in the Texas City Industrial Complex.
See Company Due Diligence:
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