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EPSILON ENERGY LTD (EPSN) Stock Fundamental Analysis

NASDAQ:EPSN - Nasdaq - CA2943752097 - Common Stock - Currency: USD

6.21  -0.3 (-4.61%)

Fundamental Rating

5

We assign a fundamental rating of 5 out of 10 to EPSN. EPSN was compared to 211 industry peers in the Oil, Gas & Consumable Fuels industry. EPSN has an excellent financial health rating, but there are some minor concerns on its profitability. While showing a medium growth rate, EPSN is valued expensive at the moment.


Dividend Valuation Growth Profitability Health

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5

1. Profitability

1.1 Basic Checks

EPSN had positive earnings in the past year.
In the past year EPSN had a positive cash flow from operations.
In the past 5 years EPSN has always been profitable.
Each year in the past 5 years EPSN had a positive operating cash flow.
EPSN Yearly Net Income VS EBIT VS OCF VS FCFEPSN Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 20M -20M 40M

1.2 Ratios

With a Return On Assets value of 4.34%, EPSN perfoms like the industry average, outperforming 44.61% of the companies in the same industry.
EPSN's Return On Equity of 5.37% is on the low side compared to the rest of the industry. EPSN is outperformed by 64.71% of its industry peers.
EPSN has a worse Return On Invested Capital (2.82%) than 73.53% of its industry peers.
The Average Return On Invested Capital over the past 3 years for EPSN is significantly below the industry average of 28.75%.
The 3 year average ROIC (16.11%) for EPSN is well above the current ROIC(2.82%). The reason for the recent decline needs to be investigated.
Industry RankSector Rank
ROA 4.34%
ROE 5.37%
ROIC 2.82%
ROA(3y)15.27%
ROA(5y)11.15%
ROE(3y)18.5%
ROE(5y)13.63%
ROIC(3y)16.11%
ROIC(5y)10.88%
EPSN Yearly ROA, ROE, ROICEPSN Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 20 -20

1.3 Margins

EPSN has a better Profit Margin (16.97%) than 60.29% of its industry peers.
In the last couple of years the Profit Margin of EPSN has remained more or less at the same level.
Looking at the Operating Margin, with a value of 14.49%, EPSN is in line with its industry, outperforming 42.65% of the companies in the same industry.
In the last couple of years the Operating Margin of EPSN has declined.
EPSN's Gross Margin of 68.48% is fine compared to the rest of the industry. EPSN outperforms 74.02% of its industry peers.
In the last couple of years the Gross Margin of EPSN has remained more or less at the same level.
Industry RankSector Rank
OM 14.49%
PM (TTM) 16.97%
GM 68.48%
OM growth 3Y91.3%
OM growth 5Y-7.16%
PM growth 3Y84.44%
PM growth 5Y0.14%
GM growth 3Y2.93%
GM growth 5Y-0.58%
EPSN Yearly Profit, Operating, Gross MarginsEPSN Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 50 -50 -100

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9

2. Health

2.1 Basic Checks

EPSN has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
Compared to 1 year ago, EPSN has less shares outstanding
The number of shares outstanding for EPSN has been reduced compared to 5 years ago.
EPSN has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
EPSN Yearly Shares OutstandingEPSN Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 5M 10M 15M 20M 25M
EPSN Yearly Total Debt VS Total AssetsEPSN Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 20M 40M 60M 80M 100M

2.2 Solvency

EPSN has an Altman-Z score of 3.47. This indicates that EPSN is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of EPSN (3.47) is better than 80.88% of its industry peers.
There is no outstanding debt for EPSN. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
Industry RankSector Rank
Debt/Equity 0
Debt/FCF N/A
Altman-Z 3.47
ROIC/WACC0.31
WACC9.06%
EPSN Yearly LT Debt VS Equity VS FCFEPSN Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 20M 40M 60M 80M 100M

2.3 Liquidity

EPSN has a Current Ratio of 2.02. This indicates that EPSN is financially healthy and has no problem in meeting its short term obligations.
EPSN has a Current ratio of 2.02. This is in the better half of the industry: EPSN outperforms 72.06% of its industry peers.
A Quick Ratio of 2.02 indicates that EPSN has no problem at all paying its short term obligations.
With a decent Quick ratio value of 2.02, EPSN is doing good in the industry, outperforming 74.02% of the companies in the same industry.
Industry RankSector Rank
Current Ratio 2.02
Quick Ratio 2.02
EPSN Yearly Current Assets VS Current LiabilitesEPSN Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 10M 20M 30M 40M 50M

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4

3. Growth

3.1 Past

EPSN shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -58.33%.
Measured over the past 5 years, EPSN shows a small growth in Earnings Per Share. The EPS has been growing by 5.15% on average per year.
EPSN shows a very negative growth in Revenue. In the last year, the Revenue has decreased by -16.70%.
EPSN shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 0.70% yearly.
EPS 1Y (TTM)-58.33%
EPS 3Y117.46%
EPS 5Y5.15%
EPS Q2Q%0%
Revenue 1Y (TTM)-16.7%
Revenue growth 3Y7.95%
Revenue growth 5Y0.7%
Sales Q2Q%15.5%

3.2 Future

The Earnings Per Share is expected to grow by 10.34% on average over the next years. This is quite good.
Based on estimates for the next years, EPSN will show a small growth in Revenue. The Revenue will grow by 6.23% on average per year.
EPS Next Y-34.19%
EPS Next 2Y10.34%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year-2.41%
Revenue Next 2Y6.23%
Revenue Next 3YN/A
Revenue Next 5YN/A

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
EPSN Yearly Revenue VS EstimatesEPSN Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 20M 40M 60M
EPSN Yearly EPS VS EstimatesEPSN Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 0.1 0.2 0.3 0.4

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2

4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 24.84, which indicates a rather expensive current valuation of EPSN.
Based on the Price/Earnings ratio, EPSN is valued a bit more expensive than 66.67% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 29.63, EPSN is valued at the same level.
Based on the Price/Forward Earnings ratio of 16.45, the valuation of EPSN can be described as correct.
Compared to the rest of the industry, the Price/Forward Earnings ratio of EPSN is on the same level as its industry peers.
When comparing the Price/Forward Earnings ratio of EPSN to the average of the S&P500 Index (22.68), we can say EPSN is valued slightly cheaper.
Industry RankSector Rank
PE 24.84
Fwd PE 16.45
EPSN Price Earnings VS Forward Price EarningsEPSN Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20 25

4.2 Price Multiples

The rest of the industry has a similar Enterprise Value to EBITDA ratio as EPSN.
Industry RankSector Rank
P/FCF N/A
EV/EBITDA 8.76
EPSN Per share dataEPSN EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 1 2 3 4

4.3 Compensation for Growth

PEG (NY)N/A
PEG (5Y)4.82
EPS Next 2Y10.34%
EPS Next 3YN/A

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3

5. Dividend

5.1 Amount

With a Yearly Dividend Yield of 3.84%, EPSN has a reasonable but not impressive dividend return.
EPSN's Dividend Yield is comparable with the industry average which is at 6.67.
EPSN's Dividend Yield is rather good when compared to the S&P500 average which is at 2.27.
Industry RankSector Rank
Dividend Yield 3.84%

5.2 History

EPSN has paid a dividend for less than 5 years, so there is no long track record yet.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years1
EPSN Yearly Dividends per shareEPSN Yearly Dividends per shareYearly Dividends per share 2022 2023 2024 0.05 0.1 0.15 0.2

5.3 Sustainability

EPSN pays out 104.03% of its income as dividend. This is not a sustainable payout ratio.
DP104.03%
EPS Next 2Y10.34%
EPS Next 3YN/A
EPSN Yearly Income VS Free CF VS DividendEPSN Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 20M -20M
EPSN Dividend Payout.EPSN Dividend Payout, showing the Payout Ratio.EPSN Dividend Payout.PayoutRetained Earnings

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EPSILON ENERGY LTD

NASDAQ:EPSN (2/21/2025, 8:15:56 PM)

6.21

-0.3 (-4.61%)

Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)11-06 2024-11-06/amc
Earnings (Next)03-20 2025-03-20
Inst Owners56%
Inst Owner Change-96.02%
Ins Owners4.84%
Ins Owner Change2.27%
Market Cap135.75M
Analysts82.86
Price Target7.14 (14.98%)
Short Float %0.2%
Short Ratio1.1
Dividend
Industry RankSector Rank
Dividend Yield 3.84%
Yearly Dividend0.25
Dividend Growth(5Y)N/A
DP104.03%
Div Incr Years0
Div Non Decr Years1
Ex-DateN/A
Surprises & Revisions
EPS beat(2)N/A
Avg EPS beat(2)N/A
Min EPS beat(2)N/A
Max EPS beat(2)N/A
EPS beat(4)N/A
Avg EPS beat(4)N/A
Min EPS beat(4)N/A
Max EPS beat(4)N/A
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)N/A
Avg Revenue beat(2)N/A
Min Revenue beat(2)N/A
Max Revenue beat(2)N/A
Revenue beat(4)N/A
Avg Revenue beat(4)N/A
Min Revenue beat(4)N/A
Max Revenue beat(4)N/A
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)0%
PT rev (3m)0%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0%
EPS NY rev (1m)0%
EPS NY rev (3m)0%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0%
Valuation
Industry RankSector Rank
PE 24.84
Fwd PE 16.45
P/S 4.36
P/FCF N/A
P/OCF 8.67
P/B 1.38
P/tB 1.38
EV/EBITDA 8.76
EPS(TTM)0.25
EY4.03%
EPS(NY)0.38
Fwd EY6.08%
FCF(TTM)-0.87
FCFYN/A
OCF(TTM)0.72
OCFY11.53%
SpS1.42
BVpS4.5
TBVpS4.5
PEG (NY)N/A
PEG (5Y)4.82
Profitability
Industry RankSector Rank
ROA 4.34%
ROE 5.37%
ROCE 3.94%
ROIC 2.82%
ROICexc 3.04%
ROICexgc 3.04%
OM 14.49%
PM (TTM) 16.97%
GM 68.48%
FCFM N/A
ROA(3y)15.27%
ROA(5y)11.15%
ROE(3y)18.5%
ROE(5y)13.63%
ROIC(3y)16.11%
ROIC(5y)10.88%
ROICexc(3y)24.67%
ROICexc(5y)16.24%
ROICexgc(3y)24.67%
ROICexgc(5y)16.24%
ROCE(3y)22.56%
ROCE(5y)15.24%
ROICexcg growth 3Y93.32%
ROICexcg growth 5Y-10.59%
ROICexc growth 3Y93.32%
ROICexc growth 5Y-10.59%
OM growth 3Y91.3%
OM growth 5Y-7.16%
PM growth 3Y84.44%
PM growth 5Y0.14%
GM growth 3Y2.93%
GM growth 5Y-0.58%
F-Score5
Asset Turnover0.26
Health
Industry RankSector Rank
Debt/Equity 0
Debt/FCF N/A
Debt/EBITDA 0
Cap/Depr 344.73%
Cap/Sales 111.05%
Interest Coverage 184.76
Cash Conversion 107.58%
Profit Quality N/A
Current Ratio 2.02
Quick Ratio 2.02
Altman-Z 3.47
F-Score5
WACC9.06%
ROIC/WACC0.31
Cap/Depr(3y)147.23%
Cap/Depr(5y)134.26%
Cap/Sales(3y)27.92%
Cap/Sales(5y)31.03%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-58.33%
EPS 3Y117.46%
EPS 5Y5.15%
EPS Q2Q%0%
EPS Next Y-34.19%
EPS Next 2Y10.34%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)-16.7%
Revenue growth 3Y7.95%
Revenue growth 5Y0.7%
Sales Q2Q%15.5%
Revenue Next Year-2.41%
Revenue Next 2Y6.23%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y-69.75%
EBIT growth 3Y106.5%
EBIT growth 5Y-6.52%
EBIT Next Year128.74%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-165.43%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-56.41%
OCF growth 3Y7.07%
OCF growth 5Y12.02%