Group 1 - The company Epsilon Energy Ltd. (NASDAQ: EPSN) has been rated bullish since May of the previous year, with a reaffirmation of this stance in October [1] - The total return for Epsilon Energy over the past 10 months is approximately 36%, while the return over the past year is around 17% [1] - The investment strategy focuses on acquiring undervalued, profitable stocks with strong balance sheets and minimal debt, while also utilizing call writing for additional income when opportunities arise [1]

Epsilon Energy (EPSN) Q4 2024 Earnings Call March 20, 2025 05:43 PM ET Company Participants Andrew Williamson - CFOJason Stabell - CEOHenry Clanton - COO Conference Call Participants John White - MD & Senior Research AnalystAnthony Perala - Research Analyst Operator Good day, and welcome to the Epsilon Energy Full Year and Fourth Quarter twenty twenty four Earnings Conference Call. All participants will be in a listen only mode. After today's presentation, there will be an opportunity to ask questions. Plea ...

Epsilon Energy Ltd. (NASDAQ:EPSN) Q4 2024 Earnings Conference Call March 20, 2025 11:30 AM ET Company Participants Andrew Williamson - Chief Financial Officer Jason Stabell - Chief Executive Officer Henry Clanton - Chief Operating Officer Conference Call Participants John White - ROTH Capital Anthony Perala - Punch & Associates Operator Good day, and welcome to the Epsilon Energy Full Year and Fourth Quarter 2024 Earning Conference Call. All participants will be in a listen-only mode. [Operator Instructions ...

The Oils-Energy group has plenty of great stocks, but investors should always be looking for companies that are outperforming their peers. Has Epsilon Energy Ltd. (EPSN) been one of those stocks this year? By taking a look at the stock's year-to-date performance in comparison to its Oils-Energy peers, we might be able to answer that question.Epsilon Energy Ltd. is a member of the Oils-Energy sector. This group includes 247 individual stocks and currently holds a Zacks Sector Rank of #7. The Zacks Sector Ran ...

Epsilon Energy Ltd. (EPSN) came out with quarterly earnings of $0.04 per share, missing the Zacks Consensus Estimate of $0.05 per share. This compares to earnings of $0.12 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -20%. A quarter ago, it was expected that this company would post earnings of $0.04 per share when it actually produced earnings of $0.02, delivering a surprise of -50%.Over the last four quarters, the company ...

Core Insights - Epsilon Energy Ltd. reported its financial results for Q4 and the full year 2024, highlighting a challenging natural gas environment and a significant increase in oil production [1][5][9]. Financial Performance - Total revenues for 2024 were $31.5 million, a 3% increase from $30.7 million in 2023 [22]. - Net income for 2024 was $1.9 million, down from $6.9 million in 2023, with net income per share at $0.09 [23][22]. - Adjusted EBITDA for 2024 was $17.6 million, a decrease from $18.8 million in 2023 [30][31]. Production and Sales - Total production in 2024 was 7,676 MMcfe, a 14% decrease year-over-year, with natural gas production down 26% [2][3]. - Oil production increased significantly by 186% year-over-year, totaling 187 Mbbl in 2024 [2][3]. - The average realized price for gas was $1.76 per Mcf, down 1% from 2023, while oil prices averaged $73.61 per Bbl, a 6% decrease [2][3]. Capital Expenditures and Investments - Capital expenditures for 2024 were $34.9 million, a 58% increase from $22 million in 2023, with Texas accounting for approximately 70% of the total [10][9]. - The company returned $7.3 million to shareholders through dividends and share repurchases [4][9]. Reserves and Future Outlook - Proved reserves increased by 20% year-over-year to 70,262 Mmcfe, while probable reserves decreased by 12% [13][14]. - The company is positioned for growth in 2025, with expectations of increased production and cash flows, supported by a strong liquidity position of over $50 million [9][5]. Operational Highlights - The Auburn Gas Gathering System delivered 36.9 Bcf of natural gas volumes in 2024, averaging 101 MMcf/d [11]. - A joint venture was established in Alberta, covering over 30,000 gross acres, with promising well economics [8][9].

Reserves and Production - As of December 31, 2024, Epsilon Energy Ltd. reported total estimated net proved reserves of 84,097 MMcfe, a 20% increase from December 31, 2023[211]. - The company estimates proved natural gas and oil reserves, which directly impact financial accounting estimates such as depreciation and impairments[262]. - Significant uncertainties exist in estimating proved reserves, including geological and engineering data interpretation, which may lead to material revisions in reserve estimates over time[262]. Financial Performance - Revenues for the year ended December 31, 2024, increased by $0.8 million, or 3%, to $31.5 million compared to $30.7 million in 2023[215]. - Net income for the year ended December 31, 2024, was $1,927,800, a decrease of $5,017,353, or 72%, from $6,945,153 in 2023[239]. - Adjusted EBITDA for the year ended December 31, 2024, was $17,578,000, a decrease of $1,249,512, or 7%, from $18,827,512 in 2023[239]. - Cash flow from operating activities provided $16.8 million in 2024, compared to $18.2 million in 2023, reflecting a decrease of $1.4 million, or 7%[245]. Revenue Sources - Upstream oil and condensate revenue for the year ended December 31, 2024, increased by $8.6 million, or 170%, over 2023, primarily due to increased production from new wells in the Permian Basin[219]. - The Auburn Gas Gathering System, located in the Marcellus Shale, is expected to maintain revenue levels despite short-term low commodity prices due to historically high recoverable reserves[275]. Expenses and Costs - General and administrative expenses for the year ended December 31, 2024, decreased by $0.3 million, or 5%, compared to the same period in 2023, primarily due to a reduction in legal expenses[231]. - Operating costs for the year ended December 31, 2024, increased by $0.9 million, or 13.4%, from the same period in 2023, primarily due to acquired and developed wells in the Permian Basin[222]. - Interest income for the year ended December 31, 2024, decreased by $1.2 million, or 71%, from the same period in 2023, primarily due to a reduction in the balance of cash and short-term investments[232]. - Interest expense decreased by $0.03 million, or 42%, during the year ended December 31, 2024, compared to 2023, due to higher fees in 2023 associated with a new credit facility[233]. - Income tax expense decreased by $1.6 million, or 49%, to $1,629,093 for the year ended December 31, 2024, primarily due to a decrease in taxable income from losses on derivative contracts[238]. Capital Expenditures and Investments - Total capital expenditures (net to Epsilon) through year-end 2024 in the Ector County, Texas project amounted to $38.6 million[206]. - The company used $16.7 million for investing activities in 2024, a decrease of $21.7 million, or 57%, from $38.4 million in 2023[246]. - Capital commitments as of December 31, 2024, were $7.8 million, related to the first two wells of a joint venture in Alberta[260]. Impairments and Asset Management - Epsilon recorded an impairment of $1.45 million for the year ended December 31, 2024, related to the Killam project in Alberta, Canada[229]. - The company reviews the carrying value of oil and natural gas properties for impairment based on expected future cash flows, which may result in reductions to fair value if cash flows are lower than carrying values[265]. - Asset retirement obligations (ARO) are recognized at fair value, requiring management to make assumptions about future costs and timing related to the retirement of long-lived assets[268]. Financing and Credit Facilities - The company closed a senior secured revolving credit facility with a current borrowing base of $45 million, maturing on June 28, 2027[248]. - The company repurchased 125,000 common shares for $627,500 at an average price of $5.00 per share during the year ended December 31, 2024[251]. Risk Management - Changes in commodity prices significantly affect the company's earnings and cash flow, with potential impacts on asset values and exploration activities[274]. - The company employs a hedging strategy to manage risks associated with commodity price fluctuations, stabilizing cash flows and supporting capital spending[276].

Core Viewpoint - The sustainability of a trend is crucial for successful short-term investing, and confirming the fundamentals behind a stock's momentum is essential for profitability [1][2]. Group 1: Trend Analysis - Timing entries into a trend significantly impacts investment success, as trends can reverse unexpectedly, leading to potential losses [1][2]. - A predefined "Recent Price Strength" screen can help identify stocks that are currently trending upward, supported by strong fundamentals and trading near their 52-week high [3]. Group 2: Company Spotlight - Epsilon Energy Ltd. (EPSN) - Epsilon Energy Ltd. has shown a solid price increase of 21.4% over the past 12 weeks, indicating strong investor interest [4]. - The stock has also increased by 11.3% in the last four weeks, suggesting that the upward trend is still intact [5]. - Currently, EPSN is trading at 95.4% of its 52-week high-low range, indicating a potential breakout [5]. Group 3: Fundamental Strength - EPSN holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises [6]. - The stock has an Average Broker Recommendation of 1 (Strong Buy), reflecting high optimism from the brokerage community regarding its near-term performance [7]. - The Zacks Rank system has a strong historical performance, with Zacks Rank 1 stocks averaging a +25% annual return since 1988 [7]. Group 4: Investment Strategy - In addition to EPSN, there are other stocks that meet the criteria of the "Recent Price Strength" screen, providing additional investment opportunities [8]. - The effectiveness of stock-picking strategies can be backtested using tools like the Zacks Research Wizard, which offers insights into successful strategies [9].

Core Viewpoint - Epsilon Energy Ltd. (EPSN) has been upgraded to a Zacks Rank 2 (Buy), indicating a positive outlook driven by an upward trend in earnings estimates [1][3]. Earnings Estimates and Stock Price Movement - The Zacks rating system emphasizes the importance of changing earnings estimates as a key factor influencing stock prices, making it a valuable tool for investors [2][4]. - The correlation between earnings estimate revisions and stock price movements is strong, with institutional investors playing a significant role in this relationship [4]. Company Performance and Outlook - The recent upgrade for Epsilon Energy reflects an improvement in the company's underlying business, suggesting that investors may respond positively by driving the stock price higher [5]. - For the fiscal year ending December 2024, Epsilon Energy is expected to earn $0.18 per share, which represents a decrease of 41.9% from the previous year [8]. - Despite the expected decline in earnings per share, analysts have raised their estimates for Epsilon Energy, with the Zacks Consensus Estimate increasing by 18.9% over the past three months [8]. Zacks Rank System - The Zacks Rank system classifies stocks based on earnings estimates and has a proven track record, with Zacks Rank 1 stocks averaging a +25% annual return since 1988 [7]. - Epsilon Energy's upgrade to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, indicating strong potential for market-beating returns in the near term [10].

Group 1 - Epsilon Energy Ltd. has terminated its previous normal course issuer bid program and approved a new one-year share repurchase program, allowing the repurchase of up to 2,200,876 common shares for a total price not exceeding US $13.0 million [1][2] - The new share repurchase program commenced on February 12, 2025, and will conclude on February 11, 2026, unless the maximum number of shares is repurchased earlier or the company provides notice of termination [1] - The company believes the market price of its common shares does not reflect their underlying value, and the repurchase initiative is seen as a way to create shareholder value [2] Group 2 - Share repurchases will be conducted through the NASDAQ Global Market at the prevailing market price, and the company plans to fund the purchases using available cash without incurring debt [3] - Epsilon Energy has undergone a borrowing base redetermination for its senior secured reserve-based lending revolving credit facility, with the new borrowing base set at $45 million effective February 10, 2025 [4] - Epsilon Energy Ltd. operates as a North American onshore natural gas and oil production and gathering company with assets located in Pennsylvania, Texas, Alberta, New Mexico, and Oklahoma [5]