Is Epsilon Energy Ltd. overvalued or undervalued?

As of 17 October 2025, Epsilon Energy Ltd. has moved from an attractive to a very expensive valuation grade. The company appears to be overvalued based on its current metrics. Key ratios include a P/E ratio of 23, an EV to EBITDA of 6.93, and a Price to Book Value of 1.67, which are significantly higher than its peers such as Tellurian, Inc. with a P/E of -6.30 and Riley Exploration Permian, Inc. with an EV to EBITDA of 3.43.
Additionally, Epsilon Energy Ltd. has underperformed against the S&P 500 across multiple time frames, with a year-to-date return of -24.15% compared to the S&P 500's 13.30%. This performance reinforces the notion that the stock is overvalued relative to its peers and the broader market.