To OTC Journal Members:
 

US Energy (OTC BB: USEI); Decide For Yourself

On Tuesday US Energy announced projected revenues for Q3 and Q4 of '06. The company expects to begin minimal shipments in Q3 - only 100- ramping up to 700 systems in Q4. The total revenues for the systems over the 2 quarters is expected in the $2.26 million range. Assuming the order flow to be delivered ends here, a likely revenue number for the year is about $3 million.

While the top line numbers are not overwhelming in scope, the comparisons are impressive. We are now likely guaranteed to have at least a 360% increase over 2005 numbers- the kind of growth makes the investment community take notice.

The company also recently achieved its first OEM order from the world's largest car manufacturer- General Motors, and its first major retrofit order with Greengas in Thailand. Don't forget the development program under way with Daewoo. 

Reader Christine L. wrote the following to me in an email to editor@otcjournal.com: "I read your post on USEI last night.  The stock opened higher this morning, but was gradually moving down and closed below opening price.  It surprised me that this stock didn't move higher with the latest news.  I was expecting to go to the $0.40 range.  I got into this stock at 0.355.  Could you please provide me with some insight whether I should be holding on to this stock, or look for a sell at 0.30 (loss) or 0.40 (gain)?"

The question referred to the day the company announced the development agreement with GM. At the time, the stock was about $.35- it perked up a bit and then promptly headed to a low of $.27- basically a reboot to our starting point. My SSL for traders was $.29- so, if you are a short term trader, you should be out now.

Investors are having a hard time understanding how this stock could be trading so poorly in light of all the recent corporate progress. I believe the problem is 100% market driven- investors are simply selling for no logical reason at this point in time. Simply a herd mentality.

I answered Christine in the following manner- I suggested at this point you have to decide if you are a long term investor (willing to hold for one year plus to go for long term capital gains), or a short term trader- looking for a quick trade anywhere from one day to one month.

If you are a short term trader, you should have sold at $.29- With the stock beginning to rebound now, it looks as if you will be able to sell at that price without too much difficulty. 

However, if you are a long term investor, you need to understand where the company is headed over the next year. In order to do that, you should try to budget the time to listen in on tomorrow's conference call. I have bolded the call in instructions below.

I have suggested to the company that they make a replay available to those who have a conflict and cannot listen in. If you can make, please do so and formulate your own thoughts.

Here is the press release which contains the conference call instructions:
 

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