Looking good.
Natural gas prices have skyrocketed since the year started, even Marcellus NG traded mostly above $4 and spiked to $5+ at times. The Canadian dollar is trading at 89c. The combination of higher NG prices and lower Canadian dollar should lead to a major jump in cash flows in Q1. Furthermore, Epsilon should shortly release its updated reserves which I expect to be materially higher; production is also probably getting close to 50 mmcf (where I expect it to flatten going forward). Finally the mid-stream should continue to experience a ramp in volume and a commensurate increase in cash flows. Meanwhile the company continues to buy shares, and will probably buy more with its excess cash flow as a result of the higher NG prices and lower Canadian dollar.
Epsilon is even more attractive today as investment compared to when I first recommended it in Q4 last year under $3.
Regards,
Nawar