Denison Mines Corp T.DML

RE: targets

[prospect_93]

Time to focus on some upside.  This was oncea $17 dollar stock and will be again.  Macquakie is welcome to there opinion.   Here is an analysis update by Raymond J. on Mar. 17. 

Denison Mines Corp.

DML-TSX | DNN-AMEX

Main Wheeler Zone Expands, but NE Extension Elusive

Event

Yesterday, DML released results from seven (7) holes at the Phoenix zone of its

60%-interest Wheeler River property in Saskatchewan.

Action

Impact is moderately positive. We recommend investors buy DML-TSX on

what we believe to be world-class exploration upside at Wheeler River,

Saskatchewan.

Analysis

?? Main Wheeler Zone Expands... Four holes drilled on the main Phoenix

Zone A expanded high-grade mineralization and include (i) 30.19% U3O8e

over 2.5 m (Hole 300), (ii) 18.5% over 3.2 m (Hole 302), (iii) 8.88% over 3.7 m

(Hole 299) and (iv) a composite of 2.87% over 6.9m (Hole 301). The holes

were drilled over a 100 m strike and DML believes intersections represent

near true widths.

?? …but Northeast Extension Elusive. Three holes drilled on the NE Area D

did not intersect mineralization, albeit confirm significant sandstone

alteration, as well as, the strongest basement alteration seen on the project

to date. Area D is also believed to coincide with a large NW-SE fault

structure. These attributes suggest Area D is highly prospective as a

potential source area for mineralization. Despite a lack of success this

round, we believe Area D has the potential to host much thicker and

extensive high-grade mineralization. The Area remains a top priority for

DML.

?? Program Logistics. The planned C$6.0 mln, 22,500 m, 45-hole 2010 drill

program continues with one rig. A second rig is expected to be added for

the summer portion of the program, which will last until Sep-2010. We

expect an initial 43-101 resource by year-end. The 2011 program is expected

to have 3-4 rigs.

?? Wheeler the Focus. In our view, the stock remains highly leveraged to

exploration success at Wheeler, particularly at the potential Area D feeder

zone. Results from the main zone also bolster Wheeler as a world-class,

high-grade asset and further underline our positive view of DML.

Valuation

We are maintaining our STRONG BUY rating and $3.30 target. Our target is

based on a 1.4x P/NAV and $2.33 NAVPS. Wheeler River constitutes 34% of

our non-financial portion of NAV, or 22% of NAV overall. Our target multiple

reflects exploration upside at Wheeler