Comparing EQT (NYSE:EQT) & Epsilon Energy (NASDAQ:EPSN)

EQT (NYSE:EQT) and Epsilon Energy (NASDAQ:EPSN) are both oils/energy companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, valuation, earnings, profitability, analyst recommendations, risk and institutional ownership.

Volatility and Risk

EQT has a beta of 1.08, indicating that its share price is 8% more volatile than the S&P 500. Comparatively, Epsilon Energy has a beta of 0.37, indicating that its share price is 63% less volatile than the S&P 500.

Dividends

EQT pays an annual dividend of $0.63 per share and has a dividend yield of 1.2%. Epsilon Energy pays an annual dividend of $0.25 per share and has a dividend yield of 4.0%. EQT pays out 75.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Epsilon Energy pays out 100.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Profitability

This table compares EQT and Epsilon Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
EQT	5.52%	3.74%	2.12%
Epsilon Energy	16.97%	5.31%	4.30%

Earnings & Valuation

This table compares EQT and Epsilon Energy”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
EQT	$6.91 billion	4.50	$1.74 billion	$0.84	62.09
Epsilon Energy	$30.73 million	4.43	$6.95 million	$0.25	24.92

EQT has higher revenue and earnings than Epsilon Energy. Epsilon Energy is trading at a lower price-to-earnings ratio than EQT, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

90.8% of EQT shares are owned by institutional investors. Comparatively, 60.3% of Epsilon Energy shares are owned by institutional investors. 0.6% of EQT shares are owned by company insiders. Comparatively, 5.5% of Epsilon Energy shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of recent ratings and price targets for EQT and Epsilon Energy, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
EQT	0	7	11	0	2.61
Epsilon Energy	0	0	1	1	3.50

EQT currently has a consensus price target of $49.94, indicating a potential downside of 4.23%. Epsilon Energy has a consensus price target of $7.00, indicating a potential upside of 12.36%. Given Epsilon Energy’s stronger consensus rating and higher possible upside, analysts clearly believe Epsilon Energy is more favorable than EQT.

Summary

EQT beats Epsilon Energy on 9 of the 17 factors compared between the two stocks.

About EQT

EQT Corporation operates as a natural gas production company in the United States. The company sells natural gas and natural gas liquids to marketers, utilities, and industrial customers through pipelines located in the Appalachian Basin. It also offers marketing services and contractual pipeline capacity management services. The company was formerly known as Equitable Resources Inc. and changed its name to EQT Corporation in February 2009. EQT Corporation was founded in 1878 and is headquartered in Pittsburgh, Pennsylvania.

About Epsilon Energy

Epsilon Energy Ltd., a North American onshore independent natural gas and oil company, engages in the acquisition, development, gathering, and production of natural oil and gas reserves in the United States. The company operates through Upstream and Gathering System segments. It has natural gas production in the Marcellus Shale in Pennsylvania; and oil, natural gas liquids, and natural gas production in the Permian Basin in Texas and New Mexico, and Anadarko Basin in Oklahoma. Epsilon Energy Ltd. was incorporated in 2005 and is based in Calgary, Canada.