Cross Timbers Royalty Trust Common Stock (CRT)

FairStock Score: 67/100 — STEADY

Key Financials

Strengths

• High return on equity of 195.6% demonstrating efficient capital deployment
• Altman Z-Score of 19.7 confirms minimal bankruptcy risk and strong solvency
• Attractive 5.3% dividend yield providing steady income returns

Concerns

• Trades significantly above Graham Number ($2) with negative 332% margin of safety—limited downside protection

AI Analysis

Cross Timbers Royalty Trust Common Stock is a micro-cap energy company valued at $64 million. Revenue stands at $6 million. From a quality standpoint, Cross shows Altman Z-Score of 19.7 confirms fortress-level solvency and extraordinary 196% return on equity. On valuation, the stock is attractively valued at 14.3x earnings, with trades far above its Graham Number ($2) with no margin of safety. Growth dynamics show revenue growing at 11.4% and profit growth of 3.3%. The 5.3% dividend yield adds an income component for patient holders. Our composite FairStock Score of 67/100 reflects above-average fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

The market underappreciates Cross's consistent 196% ROE at just 14x earnings—a re-rating toward sector peers could unlock 30-50% upside. Operational leverage in the business model means incremental revenue growth could disproportionately boost bottom-line profitability.

Bear Case

Macro headwinds or sector-specific disruption could pressure margins, particularly if competitive intensity increases in the energy space. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer