Epsilon Energy Ltd.
- Open
- 5.42
- Day high
- 5.46
- Day low
- 5.40
- Prev close
- 5.41
- Volume
- 13K
- Mkt cap
- $165M
- P/E (TTM)
- —
- EPS (TTM)
- —
- P/B
- 1.3
- P/S
- 2.7
- Yield
- 4.60%
- Per share
- $0.25
- ▲Insiders net buying $265K over the last 3 months (4 open-market buys, 0 sales)
- 🏛Institutions accumulating (13F)
Epsilon Energy Ltd. (EPSN) is a Energy company listed on NASDAQ. The stock is down 28% over the past year. Over the trailing 3 months, insiders filed 4 open-market buys and 0 sales (SEC Form 4).
Epsilon Energy Ltd. (EPSN) financials & analyst ratings
Fundamentals (TTM)
Source: exchange market data + company filings. Figures are trailing-twelve-month or as most recently reported. For informational purposes only — not investment advice.
EPSN earnings date, history & EPS estimates
| Report date | EPS est | EPS actual | Surprise | Revenue | Rev. surprise |
|---|---|---|---|---|---|
| May 14, 2026 | — | $0.03 | — | $26M | — |
| Mar 25, 2026 | $0.04 | $0.21 | +425.0% | $15M | +30.4% |
| Nov 5, 2025 | $0.03 | $0.09 | +200.0% | $9M | -21.9% |
| Aug 13, 2025 | $0.08 | $0.07 | -12.5% | $12M | +1.1% |
| May 14, 2025 | $0.14 | $0.18 | +28.6% | $16M | +38.0% |
| Mar 19, 2025 | $0.05 | $0.04 | -20.0% | $9M | -0.7% |
| Aug 13, 2024 | — | $0.04 | — | $7M | — |
| Mar 20, 2024 | — | $0.12 | — | $9M | -78.3% |
| Nov 9, 2023 | — | $0.02 | — | $6M | — |
| Aug 10, 2023 | — | $0.02 | — | $7M | — |
| Mar 23, 2023 | — | $0.41 | — | $15M | +10.5% |
| Nov 10, 2022 | — | $0.41 | — | $21M | +54.3% |
EPSN insider trading activity (SEC Form 4)
| Date | Insider | Type | Shares | Price |
|---|---|---|---|---|
| Jun 25, 2026 | Stabell Jasondirector, officer: Chief Executive Officer | Buy | 18,600 | $5.34 |
| Jun 25, 2026 | Stabell Jasondirector, officer: Chief Executive Officer | Buy | 200 | $5.26 |
| Jun 25, 2026 | Stabell Jasondirector, officer: Chief Executive Officer | Buy | 21,800 | $5.27 |
| Jun 25, 2026 | Stabell Jasondirector, officer: Chief Executive Officer | Buy | 9,400 | $5.31 |
| Apr 6, 2026 | Stabell Jasondirector, officer: Chief Executive Officer | Grant | 6,097 | — |
| Apr 6, 2026 | Williamson Andrewofficer: Chief Financial Officer | Grant | 2,540 | — |
| Mar 31, 2026 | Stabell Jasondirector, officer: Chief Executive Officer | Buy | 6,000 | $6.20 |
| Mar 31, 2026 | Stabell Jasondirector, officer: Chief Executive Officer | Buy | 12,000 | $6.22 |
| Mar 31, 2026 | Williamson Andrewofficer: Chief Financial Officer | Tax | 10,000 | $6.46 |
| Mar 31, 2026 | Stabell Jasondirector, officer: Chief Executive Officer | Buy | 2,000 | $6.17 |
| Mar 30, 2026 | Solas Capital Management, LLC10 percent owner | Sell | 22,290 | $6.17 |
| Mar 30, 2026 | Maddox Nicola Ldirector | Tax | 4,170 | $6.16 |
| Mar 30, 2026 | Solas Capital Management, LLC10 percent owner | Sell | 26,000 | $6.21 |
| Mar 30, 2026 | Solas Capital Management, LLC10 percent owner | Sell | 26,135 | $6.25 |
| Jan 23, 2026 | Maddox Nicola Ldirector | Grant | 13,598 | — |
Source: EPSN SEC Form 4 filings, latest Jun 25, 2026. For informational purposes only — not investment advice.
See the full EPSN insider & 13F page →Epsilon Energy Ltd. company profile
Overview
Epsilon Energy Ltd. (NASDAQ:EPSN) is a Houston-based natural gas and oil exploration and production company that was incorporated in 2005 and went public in 2007. The company operates through two main business segments: upstream oil and gas production, and midstream gathering operations. Epsilon has evolved from primarily a Marcellus shale natural gas producer in Pennsylvania to a more diversified energy company with operations spanning the Marcellus Basin in Pennsylvania, the Permian Basin in Texas, the Anadarko Basin in Oklahoma, and recently expanded into Alberta, Canada through joint ventures.
Business
Epsilon Energy operates in the oil and natural gas exploration and production industry, which involves locating, extracting, and selling hydrocarbon resources from underground reservoirs. The company's business is divided into two primary segments that generated approximately $31.5 million in total revenue for fiscal year 2024. **Upstream Operations (Primary Revenue Driver)**: This segment focuses on the exploration, development, and production of oil, natural gas, and natural gas liquids (NGLs) from various shale formations. The upstream business involves drilling wells into underground rock formations, using hydraulic fracturing (fracking) to release trapped hydrocarbons, and then extracting and selling these resources. Epsilon's upstream operations are geographically diversified across multiple basins. The Permian Basin in Texas has become increasingly important, contributing over 60% of cash flows in 2024, primarily from oil production. The Marcellus Basin in Pennsylvania focuses on natural gas production, though it faced challenges in 2024 due to low natural gas prices and production curtailments. The company also has smaller operations in Oklahoma's Anadarko Basin and recently entered Alberta, Canada through joint ventures. **Midstream Operations (Stable Cash Flow Generator)**: The midstream segment operates the Auburn Gas Gathering System, which provides fee-based services for gathering and transporting natural gas from wellheads to larger pipeline networks. This business model generates more predictable cash flows compared to upstream operations since it earns fees based on volume throughput rather than commodity prices. The midstream segment typically contributes around 25-30% of total revenues and provides stable cash flow that helps offset the volatility inherent in upstream commodity production. The company's asset base includes substantial undeveloped acreage, with approximately 500,000 feet of completed lateral length in inventory and significant drilling potential across its various operating areas.
Revenue model
Epsilon Energy generates revenue through multiple streams tied to hydrocarbon production and transportation services. The upstream segment makes money by selling oil, natural gas, and natural gas liquids directly to purchasers at prevailing market prices. Revenue fluctuates based on both production volumes and commodity prices, which are influenced by global supply and demand dynamics. The midstream segment earns fee-based revenue by charging other operators for gathering and transporting their natural gas through Epsilon's pipeline infrastructure, providing more stable cash flows regardless of commodity price movements. The company's customers include oil and gas purchasers, refineries, and other energy companies that either buy their produced hydrocarbons or pay for midstream services. Epsilon's business model is capital-intensive, requiring significant upfront investments in drilling, completion, and infrastructure, followed by declining production curves that necessitate ongoing drilling to maintain output levels. Several factors significantly impact Epsilon's profitability margins. **Positive margin drivers** include higher commodity prices (particularly oil and natural gas), successful drilling programs that exceed production expectations, operational efficiencies that reduce per-unit lifting costs, and favorable basis differentials between local pricing and benchmark prices. The company's geographic diversification helps mitigate regional pricing disparities, while its midstream operations provide stable fee-based income. **Negative margin drivers** include commodity price volatility (especially natural gas price weakness that led to production curtailments in 2024), increased service costs during industry upturns, transportation bottlenecks that create unfavorable basis differentials, and the natural decline rates of shale wells that require continuous capital investment. Environmental regulations, permitting delays, and weather-related operational disruptions can also pressure margins. The company uses hedging strategies to partially mitigate price volatility, typically hedging 30-45% of production at fixed prices.
Competitive moat
Epsilon Energy operates in the commodity-driven oil and gas exploration and production industry, which traditionally offers limited sustainable competitive advantages or economic moats. The company's competitive position relies primarily on operational execution, asset quality, and financial discipline rather than structural barriers to competition. **Asset Quality and Geographic Positioning**: Epsilon's strongest defensive characteristic is its diversified portfolio of acreage in established, prolific basins including the Marcellus, Permian, and Anadarko formations. The company benefits from holding acreage in areas with proven geology and existing infrastructure, which reduces development risks compared to frontier exploration. The midstream Auburn Gas Gathering System provides some degree of local monopolistic characteristics, as competing pipeline infrastructure would be costly to duplicate, offering more stable cash flows and modest pricing power within its service area. **Financial Flexibility**: The company maintains a strong balance sheet with minimal debt (debt-to-equity ratio of 0.005) and substantial cash reserves, providing financial flexibility to weather commodity downturns and capitalize on acquisition opportunities when competitors face distress. This financial strength allows Epsilon to maintain operations during low-price environments when overleveraged competitors may be forced to curtail activities. **Scale and Operational Limitations**: However, Epsilon's relatively small size (approximately $163 million market capitalization) limits its competitive advantages compared to larger integrated oil companies or major shale producers. The company lacks the scale economies in drilling, service procurement, and marketing that benefit larger operators. Additionally, as a price-taker in commodity markets, Epsilon has no control over its primary revenue drivers and faces the same geological and operational challenges as competitors. **Competitive Threats**: The company faces ongoing competition from larger, better-capitalized operators who can outbid for premium acreage, achieve better service pricing, and maintain operations during extended downturns. Technological improvements in drilling and completion techniques are widely adopted across the industry, limiting any technological competitive advantages. The potential for renewable energy transition also poses long-term structural challenges to the entire fossil fuel industry. Overall, Epsilon Energy operates with a narrow moat primarily based on asset quality and financial flexibility, but faces significant competitive pressures and commodity price exposure that limit its defensive characteristics.
Risks & safety
Epsilon Energy demonstrates a strong margin of safety from a financial stability perspective, though valuation metrics present a mixed picture. **Financial Strength and Liquidity:** • **Cash Position**: $6.9 million in cash and short-term investments as of Q1 2025, with over $50 million in total liquidity including available credit facilities • **Debt Level**: Minimal debt with debt-to-equity ratio of 0.004, essentially debt-free operations • **Current Ratio**: 1.66x indicating adequate short-term liquidity coverage • **Cash Flow Generation**: Positive operating cash flow of $8.6 million in Q1 2025, though free cash flow was modest at $0.9 million **Valuation Metrics:** • **P/E Ratio**: 9.67x based on recent earnings, suggesting reasonable valuation relative to earnings • **EV/EBITDA**: 4.06x, indicating attractive valuation relative to cash flow generation • **Price-to-Book**: 1.56x, slightly above book value • **Graham Net-Net**: Negative value indicates stock trades above liquidation value **Other Considerations:** • **Commodity Exposure**: High sensitivity to oil and gas price volatility creates earnings unpredictability • **Capital Requirements**: Ongoing capital expenditure needs of $9-12 million planned for remainder of 2025 to maintain production • **Production Decline**: Natural decline rates of shale wells require continuous investment to maintain output levels • **Hedging Coverage**: Partial hedging (30-45% of production) provides some downside protection but leaves significant commodity price exposure
Recent development
Over the past few years, Epsilon Energy has undergone significant strategic transformation, evolving from a predominantly Marcellus natural gas producer to a more diversified oil and gas company with operations across multiple basins. **Geographic Diversification Strategy**: The most significant strategic pivot has been Epsilon's expansion into the Permian Basin in Texas, which began in earnest in 2023. Through bolt-on acquisitions and development investments totaling approximately $40 million since Q2 2023, the Permian operations now contribute over 60% of the company's cash flows, dramatically reducing dependence on natural gas markets. The company acquired 14,000 gross undeveloped acres with potential for up to 40 two-mile drilling locations, fundamentally changing its asset base composition. **International Expansion**: In 2024, Epsilon entered the Canadian market through joint ventures in Alberta, marking its first international operations. The company secured a 25% working interest in 160,000 acres through partnerships with Calgary-based operators, including a $7.5 million development carry arrangement. Initial drilling of four wells commenced in late 2024, with production and sales beginning in April 2025, representing a new growth avenue outside U.S. operations. **Portfolio Optimization**: The company has strategically managed its Marcellus operations in response to challenging natural gas market conditions. During periods of low pricing in 2024, Epsilon worked with operators to curtail production by 20-25%, demonstrating operational flexibility. However, as natural gas prices recovered in early 2025, production increased by 85% quarter-over-quarter, with realized pricing improving to over $3.90 per Mcf. **Financial Discipline and Capital Allocation**: Throughout this expansion, Epsilon has maintained conservative financial management, remaining essentially debt-free while returning capital to shareholders through consistent dividends and opportunistic share repurchases. The company repurchased 1.16 million shares in 2023 and maintains flexibility for additional buybacks, balancing growth investments with shareholder returns. **Operational Technology and Efficiency**: Recent developments include optimization of artificial lift systems in Alberta operations and continued evaluation of secondary targets like the Woodford interval in the Permian Basin, indicating focus on maximizing returns from existing acreage through technological improvements and geological analysis.
EPSN company profile · for informational purposes only — not investment advice.
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