Is US Energy Corp. overvalued or undervalued?

As of 14 August 2023, the valuation grade for US Energy Corp. has moved from fair to risky, indicating a deterioration in its investment attractiveness. The company appears to be overvalued, particularly given its negative P/E ratio and troubling returns on capital, with a ROCE of -38.63% and ROE of -42.84%. Key valuation ratios include a Price to Book Value of 1.32, an EV to EBIT of -3.78, and an EV to EBITDA of -20.44, all of which suggest significant financial distress compared to its peers.
In comparison to its industry, US Energy Corp. lags behind companies like SandRidge Energy, Inc., which has a P/E of 5.83 and an EV to EBITDA of 3.67, and GeoPark Ltd., with a P/E of 4.06 and an EV to EBITDA of 2.01. The company's recent stock performance has been mixed, with a 1-week return of 4.42% compared to the S&P 500's 1.05%, but it has significantly underperformed over longer periods, such as a year-to-date return of -27.61% versus the S&P 500's 12.22%. This trend reinforces the notion that US Energy Corp. is currently overvalued in the market.