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Also traded in: Germany

GuruFocus Financial Strength Rank measures how strong a company’s financial situation is. It is based on these factors

1. The debt burden that the company has as measured by its Interest coverage (current year).
2. Debt to revenue ratio. The lower, the better
3. Altman Z-score.

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

Financial Strength : 3/10

vs
industry
vs
history
Cash-to-Debt 0.01
EPE's Cash-to-Debt is ranked lower than
99% of the 449 Companies
in the Global Oil & Gas E&P industry.

( Industry Median: 0.72 vs. EPE: 0.01 )
Ranked among companies with meaningful Cash-to-Debt only.
EPE' s Cash-to-Debt Range Over the Past 10 Years
Min: 0.01  Med: 0.01 Max: N/A
Current: 0.01
Equity-to-Asset 0.13
EPE's Equity-to-Asset is ranked lower than
81% of the 423 Companies
in the Global Oil & Gas E&P industry.

( Industry Median: 0.51 vs. EPE: 0.13 )
Ranked among companies with meaningful Equity-to-Asset only.
EPE' s Equity-to-Asset Range Over the Past 10 Years
Min: 0.11  Med: 0.24 Max: 0.43
Current: 0.13
0.11
0.43
Piotroski F-Score: 3
Altman Z-Score: -0.36
Beneish M-Score: -3.81
WACC vs ROIC
12.29%
-2.08%
WACC
ROIC
GuruFocus Profitability Rank ranks how profitable a company is and how likely the company’s business will stay that way. It is based on these factors:

1. Operating Margin
2. Trend of the Operating Margin (5-year average). The company with an uptrend profit margin has a higher rank.
••3. Consistency of the profitability
4. Piotroski F-Score
5. Predictability Rank•

The maximum rank is 10. A rank of 7 or higher means a higher profitability and may stay that way. A rank of 3 or lower indicates that the company has had trouble to make a profit.

Profitability Rank is not directly related to the Financial Strength Rank. But if a company is consistently profitable, its financial strength will be stronger.

Profitability & Growth : 6/10

vs
industry
vs
history
Operating Margin % -12.78
EPE's Operating Margin % is ranked higher than
67% of the 429 Companies
in the Global Oil & Gas E&P industry.

( Industry Median: -45.13 vs. EPE: -12.78 )
Ranked among companies with meaningful Operating Margin % only.
EPE' s Operating Margin % Range Over the Past 10 Years
Min: -207.29  Med: 24.3 Max: 48.41
Current: -12.78
-207.29
48.41
Net Margin % -3.52
EPE's Net Margin % is ranked higher than
74% of the 429 Companies
in the Global Oil & Gas E&P industry.

( Industry Median: -49.17 vs. EPE: -3.52 )
Ranked among companies with meaningful Net Margin % only.
EPE' s Net Margin % Range Over the Past 10 Years
Min: -196.44  Med: 14.92 Max: 28.55
Current: -3.52
-196.44
28.55
ROE % -3.89
EPE's ROE % is ranked higher than
68% of the 420 Companies
in the Global Oil & Gas E&P industry.

( Industry Median: -13.16 vs. EPE: -3.89 )
Ranked among companies with meaningful ROE % only.
EPE' s ROE % Range Over the Past 10 Years
Min: -150.92  Med: 5.71 Max: 20.07
Current: -3.89
-150.92
20.07
ROA % -0.52
EPE's ROA % is ranked higher than
77% of the 496 Companies
in the Global Oil & Gas E&P industry.

( Industry Median: -9.02 vs. EPE: -0.52 )
Ranked among companies with meaningful ROA % only.
EPE' s ROA % Range Over the Past 10 Years
Min: -46.89  Med: 2.45 Max: 7.89
Current: -0.52
-46.89
7.89
ROC (Joel Greenblatt) % 6.09
EPE's ROC (Joel Greenblatt) % is ranked higher than
85% of the 470 Companies
in the Global Oil & Gas E&P industry.

( Industry Median: -13.05 vs. EPE: 6.09 )
Ranked among companies with meaningful ROC (Joel Greenblatt) % only.
EPE' s ROC (Joel Greenblatt) % Range Over the Past 10 Years
Min: -56.43  Med: 5.54 Max: 17.81
Current: 6.09
-56.43
17.81
3-Year Revenue Growth Rate -25.40
EPE's 3-Year Revenue Growth Rate is ranked lower than
65% of the 369 Companies
in the Global Oil & Gas E&P industry.

( Industry Median: -18.20 vs. EPE: -25.40 )
Ranked among companies with meaningful 3-Year Revenue Growth Rate only.
EPE' s 3-Year Revenue Growth Rate Range Over the Past 10 Years
Min: 0  Med: 0 Max: -25.4
Current: -25.4
3-Year EBITDA Growth Rate -14.70
EPE's 3-Year EBITDA Growth Rate is ranked higher than
59% of the 303 Companies
in the Global Oil & Gas E&P industry.

( Industry Median: -21.60 vs. EPE: -14.70 )
Ranked among companies with meaningful 3-Year EBITDA Growth Rate only.
EPE' s 3-Year EBITDA Growth Rate Range Over the Past 10 Years
Min: 0  Med: 0 Max: -14.7
Current: -14.7
3-Year EPS without NRI Growth Rate -25.90
EPE's 3-Year EPS without NRI Growth Rate is ranked lower than
65% of the 272 Companies
in the Global Oil & Gas E&P industry.

( Industry Median: -11.00 vs. EPE: -25.90 )
Ranked among companies with meaningful 3-Year EPS without NRI Growth Rate only.
EPE' s 3-Year EPS without NRI Growth Rate Range Over the Past 10 Years
Min: 0  Med: 0 Max: -25.9
Current: -25.9
GuruFocus has detected 3 Warning Signs with EP Energy Corp $EPE.
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» EPE's 10-Y Financials

Financials (Next Earnings Date: 2017-08-04 Est.)


Revenue & Net Income
Cash & Debt
Operating Cash Flow & Free Cash Flow
Operating Cash Flow & Net Income

» Details

Guru Trades

Q1 2016

EPE Guru Trades in Q1 2016

Paul Tudor Jones Sold Out
Jim Simons 254,417 sh (-42.78%)
» More
Q2 2016

EPE Guru Trades in Q2 2016

Jeremy Grantham 14,900 sh (New)
Jim Simons 43,200 sh (-83.02%)
» More
Q3 2016

EPE Guru Trades in Q3 2016

Joel Greenblatt 14,476 sh (New)
Jim Simons 128,728 sh (+197.98%)
Jeremy Grantham Sold Out
» More
Q4 2016

EPE Guru Trades in Q4 2016

Jim Simons Sold Out
Joel Greenblatt 13,141 sh (-9.22%)
» More
» Details

Insider Trades

Latest Guru Trades with EPE

(List those with share number changes of more than 20%, or impact to portfolio more than 0.1%)

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Business Description

Industry: Oil & Gas - E&P » Oil & Gas E&P    NAICS: 211111    SIC: 1311
Compare:NYSE:AAV, OTCPK:FRHLF, OTCPK:NSTRY, OTCPK:BEPTF, NYSE:WRD, OTCPK:UNEGF, AMEX:GTE, OTCPK:MEGEF, OTCPK:PRMRF, NAS:EXXI, OTCPK:HRCXF, OTCPK:DTNOF, OTCPK:BIREF, NYSE:DNR, OTCPK:PTORF, OTCPK:KELTF, NYSE:REN, OTCPK:CRNZF, OTCPK:VREYF, NYSE:DKL » details
Traded in other countries:EPR.Germany,
Headquarter Location:USA
EP Energy Corp is an oil exploration and production company. It is in acquisition and development of unconventional oil and natural gas properties. It operates in Eagle Ford Shale, the Wolfcamp Shale, the Altamont field and the Haynesville Shale.

EP Energy Corp is an independent exploration and production company. It is engaged in the acquisition and development of unconventional onshore oil and natural gas properties in the United States. The company operate through a diverse base of producing assets and is focused on creating shareholder value through the development of its low-risk drilling inventory located in three core areas, the Eagle Ford Shale (South Texas), the Wolfcamp Shale (Permian Basin in West Texas) and the Altamont Field in the Uinta Basin (Northeastern Utah).

Guru Investment Theses on EP Energy Corp

Third Avenue Management Comments on EP Energy Corp - Sep 25, 2015

As the energy markets churned weaker over the quarter, we continued to look for attractive investment opportunities, as it was our sense that many investors were shooting first and asking questions later on their sales. We continue to believe that the current price weakness is a supply driven shock, and not what we believe would be a more worrisome lack of demand driven sell off.



The one‐two punch of higher Saudi Arabian production and potential future Iranian production have pushed oil down to the low $40 per barrel range, well below what we believe is a realistic industry wide break‐even level in the mid‐$60’s or higher, even with the benefit of recent service cost reductions that are likely not sustainable over time. In the near term we have seen a strong demand response in higher oil use and over the medium term we would expect a drop in production of higher cost barrels, which would reduce supply and lead to higher oil prices.





As we sifted through the sell‐off looking for good companies, we identified EP Energy Corp. (NYSE:EPE) as it has similar characteristics to our investment in Rosetta Resources with high quality acreage in two of the most attractive shale regions in North America in the Eagle Ford and the Permian.





EPE is an independent oil and gas exploration and production company that was previously owned by El Paso Energy. The company was sold in May 2012 to private equity investors Apollo Global Management, Riverstone Holdings, Access Industries and Korea National Oil Corporation (KNOC) for $7.2 billion. EP Energy began trading publicly in January 2014 and the private equity sponsors continue to own 85% of the shares outstanding. EPE operates in four areas: the Eagle Ford Shale in Southern Texas, the Wolfcamp Shale in the Permian Basin in West Texas, the Altamont field in the Uinta Basin in Northeastern Utah and the Haynesville Shale in North Louisiana.





EPE’s management has an excellent track record of growing oil and gas production at a 27% compound annual growth rate over the past five years and proven reserves increased by 14% last year. The company’s Eagle Ford acreage is its most economic area in the current oil and gas price environment with break‐even (a company‐defined 10% return on capital) at an oil price of $40 per barrel. EPE’s Permian Midland Basin acreage holds significant growth potential. The Wolfcamp wells have a 10% return at $44 per barrel oil which is almost as economic as the Eagle Ford acreage as a result of lower costs and improved drilling results. The Permian acreage provides EPE with long term growth opportunities with more than twice the acreage as the Eagle Ford and over 3,000 potential drilling locations. In addition the Wolfcamp is six‐times thicker than the Eagle Ford with at least 6 potential producing zones versus one in the Eagle Ford.





Although EPE has $4.9 billion of debt and a Net Debt to EBITDA ratio of 1.9 times, which is at the high end of our comfort zone, we are very comfortable with the financial strength of the company since none of the debt is due prior to 2018. In addition EP has an enviable hedge position with 95% of 2015 expected oil production hedged at a floor of $88 per barrel and 75% of estimated 2016 oil production hedged at a floor of $80 per barrel which will allow the company to live within cash flow without having to add additional debt. EP’s hedges have a current market value of around $875 million which if monetized could be used to repay debt and bring the Net Debt to EBITDA ratio down to 1.6 times.





We are confident that management’s history of improving drilling results across all of their acreage positions as well as continued cost reductions will support continued earnings improvement despite weak oil and gas prices. We also think that EPE could be an attractive acquisition target for a mid‐sized E&P that wants to enter or add to its position in the very attractive Eagle Ford and Permian plays. In addition EPE may consider divesting its Altamont or Haynesville acreage at the right price.



From Third Avenue Management's third quarter Small-Cap Fund shareholder letter.



Check out Martin Whitman latest stock trades

Ratios

vs
industry
vs
history
PB Ratio 1.88
EPE's PB Ratio is ranked lower than
68% of the 420 Companies
in the Global Oil & Gas E&P industry.

( Industry Median: 1.22 vs. EPE: 1.88 )
Ranked among companies with meaningful PB Ratio only.
EPE' s PB Ratio Range Over the Past 10 Years
Min: 0.3  Med: 1.33 Max: 2.81
Current: 1.88
0.3
2.81
PS Ratio 1.45
EPE's PS Ratio is ranked higher than
72% of the 405 Companies
in the Global Oil & Gas E&P industry.

( Industry Median: 3.60 vs. EPE: 1.45 )
Ranked among companies with meaningful PS Ratio only.
EPE' s PS Ratio Range Over the Past 10 Years
Min: 0.22  Med: 0.96 Max: 3.44
Current: 1.45
0.22
3.44
Price-to-Free-Cash-Flow 4.44
EPE's Price-to-Free-Cash-Flow is ranked higher than
78% of the 125 Companies
in the Global Oil & Gas E&P industry.

( Industry Median: 15.92 vs. EPE: 4.44 )
Ranked among companies with meaningful Price-to-Free-Cash-Flow only.
EPE' s Price-to-Free-Cash-Flow Range Over the Past 10 Years
Min: 2.67  Med: 4.7 Max: 9.5
Current: 4.44
2.67
9.5
Price-to-Operating-Cash-Flow 1.42
EPE's Price-to-Operating-Cash-Flow is ranked higher than
90% of the 267 Companies
in the Global Oil & Gas E&P industry.

( Industry Median: 8.20 vs. EPE: 1.42 )
Ranked among companies with meaningful Price-to-Operating-Cash-Flow only.
EPE' s Price-to-Operating-Cash-Flow Range Over the Past 10 Years
Min: 0.32  Med: 1.62 Max: 5.06
Current: 1.42
0.32
5.06
EV-to-EBIT 17.15
EPE's EV-to-EBIT is ranked lower than
53% of the 209 Companies
in the Global Oil & Gas E&P industry.

( Industry Median: 16.34 vs. EPE: 17.15 )
Ranked among companies with meaningful EV-to-EBIT only.
EPE' s EV-to-EBIT Range Over the Past 10 Years
Min: -237.5  Med: 4.7 Max: 26.1
Current: 17.15
-237.5
26.1
EV-to-EBITDA 6.56
EPE's EV-to-EBITDA is ranked higher than
72% of the 399 Companies
in the Global Oil & Gas E&P industry.

( Industry Median: 12.98 vs. EPE: 6.56 )
Ranked among companies with meaningful EV-to-EBITDA only.
EPE' s EV-to-EBITDA Range Over the Past 10 Years
Min: -1.9  Med: 3 Max: 13.5
Current: 6.56
-1.9
13.5
Current Ratio 0.77
EPE's Current Ratio is ranked lower than
65% of the 480 Companies
in the Global Oil & Gas E&P industry.

( Industry Median: 1.23 vs. EPE: 0.77 )
Ranked among companies with meaningful Current Ratio only.
EPE' s Current Ratio Range Over the Past 10 Years
Min: 0.77  Med: 1.7 Max: 3.7
Current: 0.77
0.77
3.7
Quick Ratio 0.72
EPE's Quick Ratio is ranked lower than
66% of the 479 Companies
in the Global Oil & Gas E&P industry.

( Industry Median: 1.12 vs. EPE: 0.72 )
Ranked among companies with meaningful Quick Ratio only.
EPE' s Quick Ratio Range Over the Past 10 Years
Min: 0.72  Med: 1.66 Max: 3.63
Current: 0.72
0.72
3.63
Days Inventory 28.10
EPE's Days Inventory is ranked higher than
51% of the 201 Companies
in the Global Oil & Gas E&P industry.

( Industry Median: 28.39 vs. EPE: 28.10 )
Ranked among companies with meaningful Days Inventory only.
EPE' s Days Inventory Range Over the Past 10 Years
Min: 25.56  Med: 26.13 Max: 28.1
Current: 28.1
25.56
28.1
Days Sales Outstanding 63.29
EPE's Days Sales Outstanding is ranked lower than
61% of the 381 Companies
in the Global Oil & Gas E&P industry.

( Industry Median: 55.27 vs. EPE: 63.29 )
Ranked among companies with meaningful Days Sales Outstanding only.
EPE' s Days Sales Outstanding Range Over the Past 10 Years
Min: 27.69  Med: 44.83 Max: 63.29
Current: 63.29
27.69
63.29
Days Payable 82.72
EPE's Days Payable is ranked lower than
53% of the 238 Companies
in the Global Oil & Gas E&P industry.

( Industry Median: 88.02 vs. EPE: 82.72 )
Ranked among companies with meaningful Days Payable only.
EPE' s Days Payable Range Over the Past 10 Years
Min: 75.63  Med: 123.37 Max: 739.94
Current: 82.72
75.63
739.94

Buy Back

vs
industry
vs
history
3-Year Average Share Buyback Ratio -6.40
EPE's 3-Year Average Share Buyback Ratio is ranked higher than
60% of the 365 Companies
in the Global Oil & Gas E&P industry.

( Industry Median: -9.80 vs. EPE: -6.40 )
Ranked among companies with meaningful 3-Year Average Share Buyback Ratio only.
EPE' s 3-Year Average Share Buyback Ratio Range Over the Past 10 Years
Min: -6.4  Med: 0 Max: 0
Current: -6.4
-6.4
0

Valuation & Return

vs
industry
vs
history
Price-to-Tangible-Book 1.88
EPE's Price-to-Tangible-Book is ranked lower than
65% of the 393 Companies
in the Global Oil & Gas E&P industry.

( Industry Median: 1.28 vs. EPE: 1.88 )
Ranked among companies with meaningful Price-to-Tangible-Book only.
EPE' s Price-to-Tangible-Book Range Over the Past 10 Years
Min: 0.59  Med: 1.76 Max: 2.72
Current: 1.88
0.59
2.72
Price-to-Median-PS-Value 1.52
EPE's Price-to-Median-PS-Value is ranked lower than
76% of the 345 Companies
in the Global Oil & Gas E&P industry.

( Industry Median: 1.02 vs. EPE: 1.52 )
Ranked among companies with meaningful Price-to-Median-PS-Value only.
EPE' s Price-to-Median-PS-Value Range Over the Past 10 Years
Min: 0.59  Med: 0.86 Max: 2.2
Current: 1.52
0.59
2.2
Earnings Yield (Greenblatt) % 5.83
EPE's Earnings Yield (Greenblatt) % is ranked higher than
80% of the 565 Companies
in the Global Oil & Gas E&P industry.

( Industry Median: -3.19 vs. EPE: 5.83 )
Ranked among companies with meaningful Earnings Yield (Greenblatt) % only.
EPE' s Earnings Yield (Greenblatt) % Range Over the Past 10 Years
Min: 3.8  Med: 18.75 Max: 23.9
Current: 5.83
3.8
23.9

More Statistics

Revenue (TTM) (Mil) $767.0
EPS (TTM) $ -0.12
Beta5.06
Short Percentage of Float40.50%
52-Week Range $3.29 - 7.49
Shares Outstanding (Mil)251.51

Analyst Estimate

Dec17 Dec18 Dec19
Revenue (Mil $) 1,173 1,252 1,401
EPS ($) -0.37 -0.30 0.10
EPS without NRI ($) -0.37 -0.30 0.10
EPS Growth Rate
(Future 3Y To 5Y Estimate)
N/A
Dividends per Share ($)
» More Articles for EPE

Headlines

Articles On GuruFocus.com
EP Energy to Host First Quarter 2017 Results Webcast on May 4 Apr 25 2017 
Seadrill Among Energy Stocks Trading With Low P/E Dec 29 2015 
Third Avenue Management Comments on EP Energy Corp Sep 25 2015 
EP Energy: Strong Operational Execution Makes This Oil Stock a Smart Investment May 06 2015 
EP Energy's Asset Profile Makes It a Good Investment Mar 29 2015 
Weekly CEO Buys Highlight: NRP, SFXE, OPK, EPE, OMN Oct 12 2014 
Weekly CEO Buys Highlight: FSFR, FSIC, OPK, EPE, ACXM Aug 23 2014 
Largest Insider Buys of the Week May 23 2014 

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