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Epsilon Energy (EPSN)
NASDAQ:EPSN
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Epsilon Energy
(NASDAQ:EPSN)
70Neutral
Epsilon Energy (EPSN) vs. S&P 500 (SPY)
Market Cap
$157.80M
Dividend Yield3.49%
Average Volume (3M)50.02K
Price to Earnings (P/E)81.6
Beta (1Y)0.49
Revenue Growth2.58%
EPS Growth-71.42%
CountryUS
Employees10
SectorEnergy
Sector Strength87
IndustryOil & Gas Exploration & Production
Share Statistics
EPS (TTM)0.09
Shares Outstanding22,008,766
10 Day Avg. Volume69,033
30 Day Avg. Volume50,015
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)4.78
Price to Cash Flow (P/CF)7.50
P/FCF Ratio7.50
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$7.00Price Target Upside-2.37% Downside
Rating ConsensusModerate Buy
Number of Analyst Covering1
Epsilon Energy Business Overview & Revenue Model
Company DescriptionEpsilon Energy Ltd., a natural gas and oil company, engages in the acquisition, development, gathering, and production of oil and gas reserves in the United States. It operates through Upstream and Gathering System segments. The Company has natural gas production in the Marcellus in Pennsylvania; and oil, natural gas liquids (NGL), and natural gas production in the Anadarko Basin in Oklahoma. As of December 31, 2021, it had total estimated net proved reserves of 110,969 million cubic feet of natural gas reserves, 819,726 barrels of NGL, and 305,052 barrels of oil and other liquids. Epsilon Energy Ltd. was incorporated in 2005 and is based in Houston, Texas.
How the Company Makes MoneyEpsilon Energy makes money through the exploration, development, and production of oil and natural gas. The company's primary revenue streams come from the sale of these commodities to energy markets and third-party purchasers. Epsilon Energy's operations in the Marcellus Shale and Anadarko Basin provide access to significant reserves, allowing the company to capitalize on fluctuating energy prices. Additionally, Epsilon may engage in strategic partnerships or joint ventures to enhance its operational efficiency and expand its asset base. Factors such as commodity price volatility, production levels, and cost management significantly influence the company's earnings.
Epsilon Energy Financial Statement Overview
Summary
Epsilon Energy shows financial stability with a strong balance sheet and solid cash generation. However, recent declines in profitability and negative free cash flow highlight challenges in maintaining growth and managing investments.Income Statement
Epsilon Energy's revenue experienced fluctuations, with a significant decline from 2022 to 2023. The gross profit margin remains strong, but net profit margin has decreased in the latest year indicating increased costs or reduced efficiency. The EBIT and EBITDA margins have also seen a decline, reflecting pressure on operational efficiency. Overall, the income statement shows potential for profitability but highlights recent challenges in maintaining consistent growth.60
Neutral
Balance Sheet
The balance sheet reflects a strong equity position with low leverage, as evidenced by a low debt-to-equity ratio. The company has maintained a robust equity ratio, indicating financial stability. However, the declining return on equity suggests challenges in generating profits from shareholder investments. Overall, the balance sheet is stable with low risk, but the company faces profitability challenges.75
Positive
Cash Flow
Operating cash flow has been consistently positive, but free cash flow has turned negative in recent years due to high capital expenditures. The operating cash flow to net income ratio remains favorable, indicating efficient cash generation relative to earnings. However, the negative free cash flow to net income ratio indicates challenges in covering investment needs without impacting cash reserves. Overall, the cash flow statement shows sustainable operations but highlights strain on cash due to investment activities.55
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 31.52M | 30.73M | 69.96M | 42.40M | 24.43M | Gross Profit |
| 11.81M | 14.18M | 54.11M | 27.15M | 6.39M | EBIT |
| 3.42M | 5.42M | 46.97M | 20.61M | 821.45K | EBITDA |
| 13.70M | 17.91M | 53.43M | 22.80M | 11.12M | Net Income Common Stockholders |
| 1.93M | 6.95M | 35.35M | 11.63M | 875.17K |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 6.52M | 32.18M | 45.24M | 26.50M | 13.27M | Total Assets |
| 120.45M | 124.04M | 123.86M | 99.46M | 86.68M | Total Debt |
| 476.91K | 563.38K | 35.30K | 0.00 | 0.00 | Net Debt |
| -6.04M | -12.84M | -45.20M | -26.50M | -13.27M | Total Liabilities |
| 23.73M | 23.43M | 19.62M | 20.20M | 17.66M | Stockholders Equity |
| 96.73M | 100.61M | 104.25M | 79.26M | 69.02M |
| Cash Flow | Free Cash Flow | |||
| -19.39M | -457.78K | 29.94M | 15.12M | 8.29M | Operating Cash Flow |
| 16.83M | 18.19M | 38.01M | 20.01M | 14.82M | Investing Cash Flow |
| -16.66M | -38.38M | -7.87M | -4.44M | -6.52M | Financing Cash Flow |
| -7.32M | -11.73M | -11.35M | -2.34M | -9.08M |
Epsilon Energy Technical Analysis
Positive
7.17
Price Trends
6.51
Positive
6.18
Positive
5.77
Positive
Market Momentum
0.20
Positive
63.52
Neutral
68.85
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EPSN, the sentiment is Positive. The current price of 7.17 is above the 20-day moving average (MA) of 6.92, above the 50-day MA of 6.51, and above the 200-day MA of 5.77, indicating a bullish trend. The MACD of 0.20 indicates Positive momentum. The RSI at 63.52 is Neutral, neither overbought nor oversold. The STOCH value of 68.85 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for EPSN.
Epsilon Energy Peers Comparison
Overall Rating
UnderperformOutperform
Sector (58)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Outperform | $12.35B | 219.89 | 0.82% | ― | -4.22% | -77.20% | |
70 Neutral | $157.80M | 81.57 | 1.95% | 3.49% | 2.58% | -71.42% | |
58 Neutral | $3.27B | 16.69 | -13.60% | ― | -11.68% | -123.15% | |
58 Neutral | $9.14B | 5.36 | -7.06% | 7.50% | 0.46% | -64.27% | |
56 Neutral | $9.46B | 35.89 | 6.88% | 0.82% | -7.57% | -69.25% | |
54 Neutral | $4.66B | 9.01 | -2.14% | ― | -4.26% | -105.72% | |
50 Neutral | $5.81B | ― | -9.51% | 0.66% | -22.76% | -199.21% |
* Energy Sector Average
Performance Comparison
EPSN
Epsilon Energy
7.17
1.91
36.31%
CRK
Comstock Resources
19.84
10.52
112.88%
CNX
CNX Resources
31.63
7.66
31.96%
RRC
Range Resources
39.19
4.71
13.66%
AR
Antero Resources
39.69
10.30
35.05%
GPOR
Gulfport Energy
183.13
23.30
14.58%
Epsilon Energy Earnings Call Summary
Earnings Call Date: Mar 19, 2025 | % Change Since: -1.10% | Next Earnings Date: May 8, 2025
Earnings Call Sentiment Positive
The earnings call reflects a positive outlook with significant growth in oil production, new project developments, and improved market conditions in the Marcellus. However, challenges in the natural gas market and deferred activity in the Marcellus present some concerns.Highlights
Permian Production Increase
Oil production in the Permian increased by 180% year-on-year, contributing more than 60% to cash flows in 2024.
New Project in Alberta, Canada
Epsilon established a new project area in Alberta with a joint venture that adds multi-year economic inventory at a $7 million drilling carry. Two wells are currently on flowback.
Marcellus Market Recovery
Production in Marcellus increased to approximately 30 million cubic feet per day, up 85% from the 2024 daily average, with wellhead pricing improving by 100%.
Reserves Growth
Proved reserves grew by approximately 20% year-over-year, with additional reserves in the Marcellus and Permian.
Financial Liquidity
Epsilon has over $50 million in liquidity, including an undrawn credit facility, providing a strong position for future investments.
Lowlights
Challenging Gas Market
Faced an oversupplied gas market with sub $2 per Mcf net wellhead pricing, resulting in production curtailments of 20% to 25% in the Marcellus.
Deferred Activity in Marcellus
No incremental drilling activity expected in the Marcellus until 2026 despite the improved market conditions.
Company Guidance
During the Epsilon Energy conference call for the fiscal year and fourth quarter of 2024, the company provided several key metrics and guidance for the future. Epsilon reported a 180% year-on-year increase in oil production, with the Permian contributing over 60% to cash flows in 2024. The company also established a new project area in Alberta, Canada, with a $7 million drilling carry, and expects to have four gross wells, or one net, on production by the end of 2025. In the Marcellus, production curtailments were estimated at 20% to 25%, but the environment improved with net revenue interest production reaching approximately 30 million cubic feet a day, an 85% increase from 2024's daily average. The company realized over $3.90 per Mcf net to wellhead, double the previous winter's figures. They maintained over $50 million in liquidity, including an undrawn credit facility, and reiterated their commitment to their fixed dividend and opportunities for share count reduction.Epsilon Energy Corporate Events
Stock BuybackBusiness Operations and Strategy
Epsilon Energy Launches New Share Repurchase Program
Positive
Feb 13, 2025
Epsilon Energy Ltd., a North American natural gas and oil production company, announced a new share repurchase program and the redetermination of its borrowing base on February 13, 2025. The company terminated its previous issuer bid and approved a new one-year repurchase initiative to buy back up to 2,200,876 common shares, accounting for 10% of its outstanding shares, for up to $13 million. This program aims to enhance shareholder value by leveraging available cash without incurring debt. Additionally, Epsilon’s borrowing base was redetermined at $45 million by Frost Bank, effective February 10, 2025, stabilizing the company’s financial position until the next reassessment.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.