The broker has a ‘buy’ recommendation with a 9p price target, compared to a current price of around 3p.
Analyst Ashley Kelty highlighted what could be characterised as favourable environment and opportunity for Rose.
“As US oil & gas production rises to record levels, positive investor sentiment towards onshore US appears to be returning, as the potential for low cost operations and high netbacks makes the investment case compelling,” the analyst said.
“With crude prices rising, and OFS costs low, many companies are expanding their operations and seeking opportunities in the US.
“However, many investors are unaware of the potential outside the more established basins (such as the Permian, Bakken and Niobrara).”
Kelty added: “Rose Petroleum has focussed on Utah’s Paradox Basin, which has been productive and has significant potential with Rose having assessed net resource of 13mmboe (2C) and 1.5bn boe (prospective) across its current acreage.
“The company is seeking to undertake low risk appraisal drilling in late 2018, with success leading to a near term development, and unlocking truly transformational potential.
“We believe that Rose is trading at a discount far below peers and that near term activity could act as a catalyst for a re-rating of the stock.”