Epsilon Energy Ltd.
$5.93
+1.4%Epsilon 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.
At a Glance
Live SnapshotIntrinsic Alpha Methodology
Thesis Lenses
Signal
Medium confidenceValuation multiple is compressed (P/E -28.2).
Valuation inputs: P/E -28.2, earnings yield N/A, momentum +1.4%.
If multiples stay elevated while momentum fades, downside repricing risk rises.
Driver
High confidenceReturn profile is soft (ROE -3.9%, ROIC +6.8%).
Profitability stack: net margin -9.4%, ROE -3.9%, ROIC +6.8%.
Quality deterioration often appears in margins before it shows up in headline EPS.
Risk
High confidenceRisk profile is balanced but has notable pressure points to monitor.
Risk factors: liabilities/assets +44.9%, momentum +1.4%, net margin -9.4%.
Higher leverage with weak momentum and thin margins can amplify drawdown severity.
Epsilon Energy Ltd. Market vs Earnings Trajectory
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Epsilon Energy Ltd. Fair Value Envelope
Epsilon Energy Ltd. Profit Bridge
Profitability Analysis
Gross Margin
Strong gross margins indicate healthy pricing and efficient production or service delivery.
Operating Margin
Outstanding operational efficiency. The company generates substantial profit from core operations.
Net Profit Margin
Net losses indicate the company is burning cash. Sustainability depends on path to profitability.
Profitability Insight
Interest or tax burden: Strong operational performance but thin net margins indicate high interest expenses or unfavorable tax position eating into profits.
Epsilon Energy Ltd. Cash Conversion Engine
Cash Flow Quality Analysis
FCF Conversion Rate
Negative free cash flow despite positive earnings raises concerns about cash generation ability or heavy capital requirements.
CapEx Intensity
Very high capital intensity consumes most operating cash flow. Limited flexibility for dividends or debt reduction.
FCF Growth Trend
Strong FCF growth demonstrates improving cash generation and business momentum. Positive signal for sustainability.
Working Capital Impact
Significant working capital drain. Growth may be consuming cash through inventory buildup or receivables extension—monitor closely.
Cash Flow Quality Insight
Capital-intensive growth: Heavy reinvestment limits current cash available but may drive future returns. Assess whether CapEx supports compelling growth opportunities with adequate ROI.
Epsilon Energy Ltd. Funding & Solvency Profile
Financial Health Analysis
Current Ratio
Acceptable liquidity, but monitor closely. Current assets just barely cover current liabilities.
Debt-to-Equity Ratio
Balanced capital structure with moderate leverage. Equity exceeds debt, suggesting healthy financial stability.
Working Capital
Positive working capital, but relatively tight. The company should monitor cash flow carefully.
Asset Composition
Capital-intensive business with significant long-term investments in property, equipment, or intangibles.
Epsilon Energy Ltd. Street Expectations Map
Wall Street analysts project that EPSN stock may rise significantly over the coming 12 months. The consensus 1-year price target stands at 8.40, with estimates ranging from a low of 8.40 to a high of 8.40.
The consensus 1-year price target stands at 8.40, with estimates ranging from a low of 8.40 to a high of 8.40.
Analyst Consensus Analysis
Upside Potential
Substantial upside potential. Analysts see significant value gap, suggesting the stock may be materially undervalued at current levels.
Analyst Agreement
High analyst agreement. Narrow target range indicates strong consensus on valuation, suggesting clear investment thesis and predictable outlook.
Analyst Conviction
Strong buy conviction: High upside with tight consensus suggests compelling investment opportunity backed by analyst confidence.
Market Sentiment Insight
Rare opportunity: Exceptional upside potential with strong analyst consensus creates a compelling setup. The combination of significant price target premium and tight agreement suggests high-conviction undervaluation that may attract institutional capital.
Epsilon Energy Ltd. Insider Positioning
During the last 12 months, insiders have purchased $560K and sold $1.75M worth of EPSN shares, resulting in $1.19M of net selling activity.
3 Months
20.0K
124.18K
74.4K
462.33K
-338K
-$338K
3-6 Months
28.5K
131.10K
74.4K
346.72K
-216K
-$216K
6-9 Months
33.7K
163.47K
74.4K
382.51K
-219K
-$219K
9-12 Months
25.0K
141.51K
74.4K
556.71K
-415K
-$415K
Top Buyers
Stabell Jason
Director, Officer: Chief Executive Officer
$442K
Williamson Andrew
Officer: Chief Financial Officer
$118K
Top Sellers
Solas Capital Management, Llc
10 Percent Owner
$1.75M
Insider Activity Analysis
Net Insider Sentiment
Strong bearish signal with $1.19M net selling. Heavy insider selling may indicate concerns about valuation or near-term prospects.
Buy/Sell Ratio
Weak buy/sell ratio. Selling significantly exceeds buying—monitor for potential fundamental concerns.
Recent Trend (3 Months)
Heavy recent selling activity. Recent insider sales notably exceed purchases—may warrant investigation into company developments.
Insider Participation
2 insider buyers vs. 1 sellers. More insiders buying than selling indicates positive sentiment.
Insider Activity Insight
Persistent selling pressure: Consistent insider selling with weak buy/sell ratio suggests insiders may be capitalizing on current valuation. Exercise caution and review recent earnings quality and management commentary.
epsn Dividend History
Learning Layer
Related Guides
Build conviction on EPSN by pairing this stock hub with focused valuation guides.
Research Paths
Snapshot
Start with context, operating signals, and key market metrics.
Value Model
Stress test fair value across bear, base, and bull assumptions.
Statements
Validate revenue quality, margins, and balance sheet durability.
Earnings Call
Read management commentary and compare it with reported outcomes.
Dividends
Check payout sustainability and long-term distribution behavior.
Analyst Expectations
Review consensus spread and where estimate risk is concentrated.