EVOLUTION PETROLEUM CORP (EPM)

US30049A1079 - Common Stock

5.61  +0.05 (+0.9%)

After market: 5.61 0 (0%)

Fundamental Rating

4

EPM gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 210 industry peers in the Oil, Gas & Consumable Fuels industry. While EPM seems to be doing ok healthwise, there are quite some concerns on its profitability. EPM does not seem to be growing, but still is valued expensively.



3

1. Profitability

1.1 Basic Checks

In the past year EPM was profitable.
EPM had a positive operating cash flow in the past year.
Of the past 5 years EPM 4 years were profitable.
In the past 5 years EPM always reported a positive cash flow from operatings.

1.2 Ratios

The Return On Assets of EPM (1.77%) is worse than 71.43% of its industry peers.
Looking at the Return On Equity, with a value of 3.54%, EPM is doing worse than 70.48% of the companies in the same industry.
EPM has a worse Return On Invested Capital (3.00%) than 74.76% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for EPM is significantly below the industry average of 30.77%.
The 3 year average ROIC (21.83%) for EPM is well above the current ROIC(3.00%). The reason for the recent decline needs to be investigated.
Industry RankSector Rank
ROA 1.77%
ROE 3.54%
ROIC 3%
ROA(3y)9.35%
ROA(5y)10.11%
ROE(3y)17.11%
ROE(5y)15.71%
ROIC(3y)21.83%
ROIC(5y)16.98%

1.3 Margins

Looking at the Profit Margin, with a value of 3.57%, EPM is doing worse than 68.57% of the companies in the same industry.
EPM's Profit Margin has declined in the last couple of years.
Looking at the Operating Margin, with a value of 6.96%, EPM is doing worse than 72.38% of the companies in the same industry.
EPM's Operating Margin has declined in the last couple of years.
EPM has a Gross Margin (41.22%) which is in line with its industry peers.
EPM's Gross Margin has declined in the last couple of years.
Industry RankSector Rank
OM 6.96%
PM (TTM) 3.57%
GM 41.22%
OM growth 3Y27%
OM growth 5Y-2.46%
PM growth 3Y10.96%
PM growth 5Y-10.65%
GM growth 3Y-0.43%
GM growth 5Y-5.53%

5

2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so EPM is creating value.
Compared to 1 year ago, EPM has less shares outstanding
EPM has more shares outstanding than it did 5 years ago.
There is no outstanding debt for EPM. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.

2.2 Solvency

An Altman-Z score of 2.37 indicates that EPM is not a great score, but indicates only limited risk for bankruptcy at the moment.
EPM has a Altman-Z score of 2.37. This is in the better half of the industry: EPM outperforms 63.81% of its industry peers.
A Debt/Equity ratio of 0.51 indicates that EPM is somewhat dependend on debt financing.
EPM's Debt to Equity ratio of 0.51 is in line compared to the rest of the industry. EPM outperforms 47.62% of its industry peers.
Industry RankSector Rank
Debt/Equity 0.51
Debt/FCF N/A
Altman-Z 2.37
ROIC/WACC0.35
WACC8.63%

2.3 Liquidity

A Current Ratio of 1.49 indicates that EPM should not have too much problems paying its short term obligations.
With a decent Current ratio value of 1.49, EPM is doing good in the industry, outperforming 60.95% of the companies in the same industry.
EPM has a Quick Ratio of 1.49. This is a normal value and indicates that EPM is financially healthy and should not expect problems in meeting its short term obligations.
EPM has a better Quick ratio (1.49) than 66.19% of its industry peers.
Industry RankSector Rank
Current Ratio 1.49
Quick Ratio 1.49

3

3. Growth

3.1 Past

EPM shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -94.59%.
Measured over the past years, EPM shows a very strong growth in Earnings Per Share. The EPS has been growing by 20.46% on average per year.
The Revenue for EPM has decreased by -45.64% in the past year. This is quite bad
The Revenue has been growing by 25.81% on average over the past years. This is a very strong growth!
EPS 1Y (TTM)-94.59%
EPS 3Y100%
EPS 5Y20.46%
EPS Q2Q%-97.56%
Revenue 1Y (TTM)-45.64%
Revenue growth 3Y63.14%
Revenue growth 5Y25.81%
Sales Q2Q%-37.55%

3.2 Future

EPM is expected to show a very negative growth in Earnings Per Share. In the coming years, the EPS will decrease by -33.16% yearly.
EPM is expected to show a decrease in Revenue. In the coming years, the Revenue will decrease by -6.69% yearly.
EPS Next Y-84.46%
EPS Next 2Y-33.16%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year-30.95%
Revenue Next 2Y-6.69%
Revenue Next 3YN/A
Revenue Next 5YN/A

3.3 Evolution

The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.

1

4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 70.13, which means the current valuation is very expensive for EPM.
75.71% of the companies in the same industry are cheaper than EPM, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 24.41, EPM is valued quite expensively.
A Price/Forward Earnings ratio of 12.07 indicates a correct valuation of EPM.
The rest of the industry has a similar Price/Forward Earnings ratio as EPM.
EPM is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 20.59, which is the current average of the S&P500 Index.
Industry RankSector Rank
PE 70.13
Fwd PE 12.07

4.2 Price Multiples

Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of EPM indicates a slightly more expensive valuation: EPM is more expensive than 61.90% of the companies listed in the same industry.
Industry RankSector Rank
P/FCF N/A
EV/EBITDA 9.23

4.3 Compensation for Growth

A cheap valuation may be justified as EPM's earnings are expected to decrease with -33.16% in the coming years.
PEG (NY)N/A
PEG (5Y)3.43
EPS Next 2Y-33.16%
EPS Next 3YN/A

6

5. Dividend

5.1 Amount

EPM has a Yearly Dividend Yield of 8.47%, which is a nice return.
EPM's Dividend Yield is rather good when compared to the industry average which is at 5.93. EPM pays more dividend than 84.29% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.30, EPM pays a better dividend.
Industry RankSector Rank
Dividend Yield 8.47%

5.2 History

On average, the dividend of EPM grows each year by 6.61%, which is quite nice.
EPM has been paying a dividend for at least 10 years, so it has a reliable track record.
EPM has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)6.61%
Div Incr Years3
Div Non Decr Years3

5.3 Sustainability

EPM pays out 542.44% of its income as dividend. This is not a sustainable payout ratio.
The Dividend Rate of EPM has been growing, while earnings will be declining. This means the dividend growth is most likely not sustainable.
DP542.44%
EPS Next 2Y-33.16%
EPS Next 3YN/A

EVOLUTION PETROLEUM CORP

NYSEARCA:EPM (7/26/2024, 7:27:16 PM)

After market: 5.61 0 (0%)

5.61

+0.05 (+0.9%)

Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap187.15M
Analysts
Price Target
Dividend
Industry RankSector Rank
Dividend Yield 8.47%
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
Avg EPS beat(4)
Min EPS beat(4)
Max EPS beat(4)
EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
Avg EPS beat(12)
EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
Avg Revenue beat(4)
Min Revenue beat(4)
Max Revenue beat(4)
Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
Avg Revenue beat(12)
Revenue beat(16)
Avg Revenue beat(16)
PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
Industry RankSector Rank
PE 70.13
Fwd PE 12.07
P/S
P/FCF
P/OCF
P/B
P/tB
EV/EBITDA
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)N/A
PEG (5Y)3.43
Profitability
Industry RankSector Rank
ROA 1.77%
ROE 3.54%
ROCE
ROIC
ROICexc
ROICexgc
OM 6.96%
PM (TTM) 3.57%
GM 41.22%
FCFM
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.5
Health
Industry RankSector Rank
Debt/Equity 0.51
Debt/FCF
Debt/EBITDA
Cap/Depr
Cap/Sales
Interest Coverage
Cash Conversion
Profit Quality
Current Ratio 1.49
Quick Ratio 1.49
Altman-Z
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
High Growth Momentum
Growth
EPS 1Y (TTM)-94.59%
EPS 3Y100%
EPS 5Y
EPS Q2Q%
EPS Next Y-84.46%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)-45.64%
Revenue growth 3Y63.14%
Revenue growth 5Y
Sales Q2Q%
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y