Rox Resources (ASX:RXL) has the potential to outperform its gold exploration and development peers, driven by an upcoming exploration program and a more favorable gold price environment, Euroz Hartleys said in a Wednesday note.

Exploration success is expected to quickly add value to the company's Younami gold project in Western Australia, enabling the company to catch up to its peers on an enterprise value or resource basis, the note said.

On Wednesday, the company said it completed the first tranche and share purchase plan as part of an AU$27 million capital raise to fund a drilling program of about 35,000 meters at the Younami project.

The drilling contract confirms the potential for the project to be monetized by fiscal 2027, with exploration and dewatering progressing as planned, according to Euroz Hartleys.

The drill program could unlock the asset's potential to produce over 100,000 ounces per annum in the pre-feasibility study and to see the first gold in fiscal 2027, the financial services firm added.

The firm also noted that the appointment of Phill Wilding as chief executive, with his previous experience as chief operating officer at West Gold Resources (ASX:WGX) , helps mitigate development risk

Euroz Harltleys has a speculative buy recommendation on Rox Resources and a price target of AU$0.27.

Shares of Rox Resources rose past 2% in recent Friday trade and earlier hit their highest since July 2023, while West Gold Resources' shares were up almost 1%.

Price (AUD): $0.25, Change: $+0.0050, Percent Change: +2.08%