Evolution Petroleum (EPM) AI Stock Analysis

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Evolution Petroleum

(NYSE MKT:EPM)

Rating:56Neutral

Price Target:

$5.00

▼(-1.38%Downside)

Evolution Petroleum's overall stock score is driven by challenges in financial performance, particularly in profitability and cash flow. While technical indicators and corporate events provide some positive outlook, valuation concerns and mixed earnings call sentiment weigh on the score. The company's strong dividend yield and recent strategic moves offer some support but are not enough to offset the financial challenges.

Evolution Petroleum (EPM) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$173.60M

Dividend Yield9.47%

Average Volume (3M)190.39K

Price to Earnings (P/E)89.3

Beta (1Y)0.72

Revenue Growth3.79%

EPS Growth-131.01%

CountryUS

Employees11

SectorEnergy

Sector Strength51

IndustryOil & Gas Exploration & Production

Share Statistics

EPS (TTM)-0.07

Shares Outstanding34,307,640

10 Day Avg. Volume182,043

30 Day Avg. Volume190,389

Financial Highlights & Ratios

PEG Ratio1.57

Price to Book (P/B)2.37

Price to Sales (P/S)0.00

P/FCF Ratio5.94

Enterprise Value/Market Cap0.97

Enterprise Value/Revenue1.45

Enterprise Value/Gross Profit11.18

Enterprise Value/Ebitda2.93

Forecast

1Y Price Target

$5.10

Price Target Upside0.59% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering2

Evolution Petroleum Business Overview & Revenue Model

Company DescriptionEvolution Petroleum Corporation, an oil and natural gas company, engages in the development, production, ownership, and management of oil and gas properties in the United States. The company holds interests in a CO2 enhanced oil recovery project in Louisiana's Delhi field. Its Delhi Holt-Bryant Unit covers an area of 13,636 acres located in Northeast Louisiana. The company also holds interests in the Hamilton Dome field covering 5,908 acres located in Wyoming; and Barnett Shale field covering an area of 123,777 acres located in North Texas. Evolution Petroleum Corporation was founded in 2003 and is based in Houston, Texas.

How the Company Makes MoneyEvolution Petroleum Corporation generates revenue primarily through the sale of crude oil, natural gas, and natural gas liquids (NGLs) extracted from its operated and non-operated properties. The company employs enhanced oil recovery (EOR) techniques to maximize production from mature fields, thereby increasing the recoverable reserves and extending the life of existing wells. Key revenue streams include the sale of produced hydrocarbons in the open market, as well as through long-term contracts with refiners, marketers, and distributors. EPM's earnings are influenced by market prices for oil and gas, production volumes, and operational efficiencies. Partnerships and joint ventures with other exploration and production companies also play a significant role in leveraging expertise and resources to optimize field development and production strategies.

Evolution Petroleum Earnings Call Summary

Earnings Call Date:May 13, 2025

(Q3-2025)

% Change Since: 16.02%|

Next Earnings Date:Sep 16, 2025

Earnings Call Sentiment Neutral

The earnings call highlighted significant achievements such as the successful Tex-Mex acquisition and strong natural gas revenue growth, which were offset by challenges including a decline in total revenue and production, as well as a net loss for the quarter. The company's commitment to dividends and financial flexibility provides a positive outlook, but operational setbacks and financial losses temper the overall sentiment.

Q3-2025 Updates

Positive Updates

Tex-Mex Acquisition and Chaveroo Wells Performance

Subsequent to the quarter end, Evolution Petroleum closed the Tex-Mex acquisition and brought online four new wells in the Chaveroo development block, contributing more than 850 net barrels of oil equivalent per day. This is expected to benefit fiscal fourth quarter production and cash flow.

Strong Natural Gas Revenue Growth

Natural gas revenue rose 33% year-over-year to $7.8 million, and NGL revenue increased by 14% to $3 million, partially offsetting a 19% decline in oil revenue. This demonstrates the resilience of the company's diversified portfolio.

Dividend Declaration

The Board declared a cash dividend of $0.12 per share, marking the 47th consecutive quarter of issuing a dividend and the 12th consecutive quarter at this rate, reflecting the company's commitment to returning capital to shareholders.

Increased Liquidity and Credit Facility Expansion

Evolution Petroleum has total liquidity of $20.1 million, with borrowings of $35.5 million. The company also received approval to increase its credit facility commitments to $65 million, providing greater financial flexibility.

Negative Updates

Decline in Overall Revenue and Production

Total revenues decreased by 2% year-over-year to $22.6 million, driven by an 8% decrease in production volumes due to downtime at Barnett and maintenance at Delhi.

Net Loss Reported

The company reported a net loss of $2.2 million, or $0.07 per share, compared to net income of $0.3 million or $0.01 per share in the same period last year.

Operational Challenges at Delhi and Barnett

Production was affected by planned maintenance at Delhi and weather-related downtime in Barnett, leading to a 7.5% decline in total production year-over-year.

Company Guidance

During the Evolution Petroleum Fiscal Third Quarter 2025 Earnings Conference Call, the company provided several key metrics and guidance. Evolution Petroleum reported a total revenue of $22.6 million, a 2% year-over-year decrease, driven primarily by an 8% decrease in production volumes, which was partially offset by a 7% increase in average realized commodity prices. The company highlighted the completion of the Tex-Mex acquisition, which contributes approximately 440 net barrels of oil equivalent per day. Additionally, four new wells in the Chaveroo development block are now online, contributing more than 850 net barrels of oil equivalent per day. The company maintains a strong hedging strategy, with about 40% of oil volumes hedged at prices above $70 through the fiscal year-end. Adjusted EBITDA was reported at $7.4 million, a decrease from the previous year, but 30% higher than the previous quarter due to improved commodity prices. The company also declared a quarterly cash dividend of $0.12 per share, marking its 47th consecutive quarterly dividend and emphasizing a commitment to returning capital to shareholders. Looking ahead, Evolution Petroleum plans to focus on preserving financial flexibility, sustaining dividends, and pursuing growth opportunities, particularly in gas-weighted areas, while delaying certain oil-weighted developments due to market conditions.

Evolution Petroleum Financial Statement Overview

Summary

Evolution Petroleum faces challenges in profitability and cash flow, with declining margins and negative free cash flow, despite a stable balance sheet with low leverage. Improvement in revenue and cost control is necessary for financial stability.

Income Statement

Neutral

Evolution Petroleum's income statement reveals fluctuating revenue with a notable decline in the TTM period, which is concerning. The gross profit margin has decreased from 42.5% in 2023 to 20.4% TTM, indicating pressure on profitability. The net profit margin also fell significantly from 27.4% in 2023 to 2.0% TTM, reflecting increased costs or lower revenue. Additionally, EBIT and EBITDA margins have decreased, emphasizing the need for efficiency improvements.

Balance Sheet

Positive

The balance sheet is relatively strong, showcasing a low debt-to-equity ratio of 0.0002 in the TTM period, indicating low leverage. Despite this, the return on equity has dropped from 38.2% in 2023 to 2.3% TTM, suggesting decreased profitability. The equity ratio is healthy at 47.6% TTM, reflecting a solid financial foundation.

Cash Flow

Negative

Cash flow analysis highlights challenges, with a negative free cash flow of -$17.2 million TTM, a deterioration from -$26.9 million in 2023. The operating cash flow to net income ratio is strong at 15.1 TTM, but the free cash flow to net income ratio is negative, signaling cash management issues. The company needs to address these cash flow concerns to improve financial health.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	85.88M	128.51M	108.93M	32.70M	29.60M
Gross Profit	19.00M	54.70M	52.22M	11.16M	10.48M
EBITDA	27.02M	60.02M	49.77M	-16.15M	11.01M
Net Income	4.08M	35.22M	32.63M	-16.44M	5.94M
Balance Sheet
Total Assets	162.88M	128.32M	148.05M	76.71M	92.14M
Cash, Cash Equivalents and Short-Term Investments	6.45M	11.03M	8.28M	5.28M	19.66M
Total Debt	39.66M	184.00K	21.25M	4.02M	84.98K
Total Liabilities	81.75M	36.22M	72.53M	22.11M	18.01M
Stockholders Equity	81.13M	92.09M	75.51M	54.59M	74.12M
Cash Flow
Free Cash Flow	-26.90M	44.28M	-2.41M	-14.04M	1.33M
Operating Cash Flow	22.73M	51.27M	52.46M	4.73M	12.40M
Investing Cash Flow	-49.63M	-6.99M	-54.87M	-18.77M	-11.06M
Financing Cash Flow	22.32M	-41.53M	5.42M	-349.43K	-13.22M

Evolution Petroleum Technical Analysis

Technical Analysis Sentiment

Positive

Last Price5.07

Price Trends

50DMA

4.73

Positive

100DMA

4.61

Positive

200DMA

4.85

Positive

Market Momentum

MACD

0.07

Negative

RSI

62.97

Neutral

STOCH

93.17

Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EPM, the sentiment is Positive. The current price of 5.07 is above the 20-day moving average (MA) of 4.87, above the 50-day MA of 4.73, and above the 200-day MA of 4.85, indicating a bullish trend. The MACD of 0.07 indicates Negative momentum. The RSI at 62.97 is Neutral, neither overbought nor oversold. The STOCH value of 93.17 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for EPM.

Evolution Petroleum Peers Comparison

Overall Rating

UnderperformOutperform

Sector (67)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
REI	71 Outperform	$164.97M	2.25	8.52%	―	-4.51%	-10.09%
Sector *	67 Neutral	$15.31B	9.88	6.83%	5.21%	4.41%	-68.95%
PHX	65 Neutral	$164.96M	23.68	5.55%	3.68%	11.84%	61.88%
EPSN	65 Neutral	$136.73M	30.96	4.45%	4.01%	35.21%	-9.18%
EPM	56 Neutral	$173.60M	89.30	-1.24%	9.47%	3.79%	-131.01%
GTE	51 Neutral	$163.57M	21.67	-4.07%	―	-2.39%	-425.29%
WTI	51 Neutral	$270.20M	―	203.83%	2.19%	-5.05%	-383.38%

* Energy Sector Average

Performance Comparison

EPM

Evolution Petroleum

5.07

0.06

1.20%

GTE

Gran Tierra Energy

4.69

-4.08

-46.52%

PHX

PHX Minerals

4.35

1.23

39.42%

WTI

W&T Offshore

1.83

-0.45

-19.74%

REI

Ring Energy

0.83

-1.07

-56.32%

EPSN

Epsilon Energy

6.24

1.00

19.08%

Evolution Petroleum Corporate Events

Private Placements and FinancingBusiness Operations and StrategyFinancial Disclosures

Evolution Petroleum Gains from Barnett Shale Audit Results

Positive

Jul 2, 2025

On June 30, 2025, Evolution Petroleum Corporation entered into an amended and restated senior secured reserve-based credit agreement with MidFirst Bank, allowing for borrowings up to $200 million, with an initial borrowing base of $65 million, maturing on June 30, 2028. This facility supports working capital, acquisitions, and development of oil and gas properties, with specific financial covenants and hedging requirements. On July 1, 2025, Evolution announced the results of a joint interest audit of its Barnett Shale properties, revealing approximately $1.8 million owed to the company due to overcharges from the largest operator for the years 2022-2023. This adjustment will positively impact their fiscal year 2025 results, and further audits are expected to yield additional benefits.

The most recent analyst rating on (EPM) stock is a Buy with a $8.25 price target. To see the full list of analyst forecasts on Evolution Petroleum stock, see the EPM Stock Forecast page.

DividendsBusiness Operations and StrategyFinancial Disclosures

Evolution Petroleum Reports Q3 Loss, Declares Dividend

Neutral

May 13, 2025

On May 13, 2025, Evolution Petroleum announced its fiscal third-quarter results, revealing a net loss of $2.2 million, despite a 30% increase in adjusted EBITDA from the previous quarter. The company declared a $0.12 per share dividend for the fourth quarter of 2025, marking its 47th consecutive quarterly dividend, and highlighted the successful acquisition of non-operated oil and gas assets, which are expected to enhance future production.

The most recent analyst rating on (EPM) stock is a Buy with a $8.25 price target. To see the full list of analyst forecasts on Evolution Petroleum stock, see the EPM Stock Forecast page.

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 03, 2025