U.S. Energy Corp. (USEG)

[Timothy Smith]

U.S. Energy shares have drifted lower in 2012 and it seems that the stock is now very undervalued and oversold due to end of the year tax loss selling, putting additional pressure on the stock. This stock appears to have little analyst coverage and it is not as well-known as many other larger oil companies. This can create a major valuation gap or discount which might make sense to take advantage of now.

One analyst firm that does cover this company is Global Hunter Securities which gave this stock a $4.50 price target and an "accumulate" rating.

This stock looks very cheap and it trades well below book value, which is $4.50 per share (right where Global Hunter Securities sees the stock price going in the future.) If U.S. Energy assets are worth the book value level of about $4.50 per share, and the stock is trading just below $2, it might even be an attractive takeover target from one of its joint venture or other partners.