Definitive Analysis
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Definitive Analysis

Financial Statements

Ticker

Industry

Sector

Epsilon Energy Ltd. (EPSN)

Company Dividend Discount ModelIndustry: Oil & Gas Exploration & ProductionSector: Energy

Valuation Snapshot

Stable Growth$2.06 - $3.03$2.52
Multi-Stage$3.93 - $4.30$4.11
Blended Fair Value$3.32
Current Price$7.38
Upside-55.04%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS0.00%0.00%0.250.250.270.000.000.000.000.000.000.00
YoY Growth---2.03%-4.46%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%
Dividend Yield--3.51%4.61%4.96%0.00%0.00%0.00%0.00%0.00%0.00%0.00%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)5.88
(-) Cash Dividends Paid (M)5.40
(=) Cash Retained (M)0.47
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)1.180.730.44
Cash Retained (M)0.470.470.47
(-) Cash Required (M)-1.18-0.73-0.44
(=) Excess Retained (M)-0.70-0.260.03
(/) Shares Outstanding (M)22.1222.1222.12
(=) Excess Retained per Share-0.03-0.010.00
LTM Dividend per Share0.240.240.24
(+) Excess Retained per Share-0.03-0.010.00
(=) Adjusted Dividend0.210.230.25
WACC / Discount Rate8.13%8.13%8.13%
Growth Rate-2.00%-1.00%0.00%
Fair Value$2.06$2.52$3.03
Upside / Downside-72.12%-65.81%-59.00%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)5.885.825.765.705.655.595.76
Payout Ratio91.92%91.54%91.15%90.77%90.38%90.00%92.50%
Projected Dividends (M)5.405.335.255.185.105.035.33

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate8.13%8.13%8.13%
Growth Rate-2.00%-1.00%0.00%
Year 1 PV (M)4.884.934.98
Year 2 PV (M)4.404.494.58
Year 3 PV (M)3.974.104.22
Year 4 PV (M)3.593.733.89
Year 5 PV (M)3.243.403.58
PV of Terminal Value (M)66.8470.3273.95
Equity Value (M)86.9290.9895.20
Shares Outstanding (M)22.1222.1222.12
Fair Value$3.93$4.11$4.30
Upside / Downside-46.76%-44.27%-41.68%

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