Epsilon Energy Ltd. (EPSN)
Valuation Overview•Is Epsilon Energy Ltd. Overvalued or Undervalued?
Commands a premium valuation multiple over its peers, likely pricing in superior execution.
Moderate quality score of 51/100, reflecting stable operating margins and manageable leverage.
Analysts remain bullish, forecasting further upside expansion with consensus targets suggesting solid gains.
Verdict: Average quality business weighed down by significant solvency concerns.
Wall Street is highly bullish, projecting significant upside alongside robust expected earnings growth. This is paired with healthy capital returns, anchored by a strong dividend yield, though free cash flow coverage appears tight.
EPSN demonstrates adequate business quality with stable profitability. This is paired with a moderately leveraged but stable balance sheet.
The company is facing top-line contraction (-9.7% 3Y CAGR) paired with stable bottom-line earnings. This growth is supported by elite operational efficiency, sustaining an impressive 27.3% operating margin.
| Financial Metric | Trend (12Q) | Latest Qtr | 1Y Growth | 3Y CAGR | 5Y CAGR | 10Y CAGR |
|---|---|---|---|---|---|---|
| Revenue | $25.6M | +63.7% | -9.7% | +16.1% | +8.0% | |
| EBITDA | $13.9M | — | -19.6% | — | — | |
| Net Income | $729K | -400.8% | — | — | +13.8% | |
| EPS (Diluted) | $0.02 | -338.9% | — | — | +14.9% | |
| Free Cash Flow | $5.8M | +126.5% | -44.1% | -8.8% | — |
| Metric | TTM | 3Y Avg | 5Y Avg | 10Y Avg |
|---|---|---|---|---|
| Gross Margin | 49.1% | 43.7% | 54.5% | 44.8% |
| Operating Margin | 27.3% | 19.6% | 34.9% | 26.6% |
| Net Margin | -14.9% | 5.8% | 19.1% | 18.7% |
| FCF Margin | 16.5% | -18.0% | 4.9% | 12.5% |
| Quarter | EPS Est. | EPS Act. | Surprise | EPS | Rev |
|---|---|---|---|---|---|
| Q2'26Latest | — | $0.03 | — | ||
| Q1'26 | $0.04 | $0.21 | +425.0% | ||
| Q4'25 | $0.03 | $0.09 | +200.0% | ||
| Q3'25 | $0.08 | $0.07 | -12.5% | ||
| Q2'25 | $0.14 | $0.18 | +28.6% | ||
| Q1'25 | $0.05 | $0.04 | -20.0% | ||
| Q4'24 | $0.04 | $0.02 | -50.0% | ||
| Q3'24 | — | $0.04 | — |
Total return is -32.2% (1Y), lagging the benchmark by -53.0%
| Period | Total Return | vs S&P 500 (Alpha) | Dividend Contribution |
|---|---|---|---|
| YTD | +14.7% | +7.3% | — |
| 1Y | -32.2% | -53.0% | +3.1% |
| 3YCAGR | +3.8% | -13.6% | +14.2% |
| 5YCAGR | +5.3% | -5.5% | +23.2% |
| 10YCAGR | -48.8% | -62.5% | — |
The S&P 500 is at 30.6x trailing P/E — Expensive relative to historical averages.
Quick answers to common questions about Epsilon Energy Ltd. (EPSN) valuation, health, and returns.
Based on peer relative multiples, Epsilon Energy Ltd. appears Expensive versus peers compared to industry peers.
Epsilon Energy Ltd. has multiple valuation anchors: Peer Relative Fair Value: $2.24 | Wall Street Analyst Target: $8.40 (implying +55.0% upside). A convergence of these signals offers higher conviction.
Epsilon Energy Ltd. displays fair financial health with a composite quality score of 51/100, supported by a Altman Z-Score of 0.6 (distress zone), Piotroski F-Score of 3/9, Return on Invested Capital (ROIC) of 9.1%.
Epsilon Energy Ltd. pays a 4.8% dividend yield, covered by a 0% payout ratio with 0 years of growth, supplemented by a 0.0% buyback yield.
Epsilon Energy Ltd.'s current growth trajectory is Accelerating. The company achieved +63.7% 1Y revenue growth and -338.9% 1Y EPS growth, compared to its 3Y revenue CAGR of -9.7%.
Wall Street consensus is Hold based on 0 analysts, beating EPS expectations in 38% of recent quarters with a 2-quarter streak. The consensus price target represents a +55.0% change from current levels.
Investment risks for Epsilon Energy Ltd. include: -45.6% 1-year max drawdown, elevated distress risk. Volatility risk is characterized by a beta of -0.00x.
No. These computations are purely quantitative model outputs for informational purposes. They do not account for qualitative management shifts or macro events. Always consult a licensed RIA before buying or selling shares.
Disclaimer: This page is for informational purposes only and does not constitute financial advice. All valuation models, scores, and target estimates are automated computations under stated assumptions and should not be relied upon as the sole basis for any investment decision.