RB Milestone Raises Target on JNN

SHIRISH VAIDYA, RB Milestone Group (01/31/2011)
"JNR Resources Inc. is a Canada-based junior uranium exploration company with mineral properties in the provinces of Saskatchewan and Newfoundland. JNR has a varied interest in several prospective uranium properties in the Athabasca Basin of northern Saskatchewan, where uranium mineralization is preferentially located on or near geological features known as unconformities. In 2010, the company progressed well on its exploration projects on its various mining assets and reported the discovery of strong mineralization for its key projects. On January 5, 2011, the company announced that it extended the mineralized zone at its 50%-owned Koorae Cu/Mo/Au/Ag Prospect, Topsails Project, Newfoundland. JNR also announced the discovery of significant base metal mineralization on its 100%-owned Yurchison Lake Property in the second week of December 2010. The company completed airborne gravity surveys on the Snowbird-South Dufferin Projects, the results of which are being processed and integrated with prior ground and airborne geophysical programs to further define drill targets.

Investment Takeaways: Increase in mining assets at Topsails Project, Newfoundland; drilling results for Topsails and Yurchison Lake properties showed good potential; remains on track for exploration work with announcement of 2011 winter exploration programs; and remains well funded for exploration work after recent private placement.

At the current price of CAD$0.38, JNR's EV of CAD$37.58 is significantly low compared to the EV of CAD$55M implied by comparable parameters. . .We have valued JNR on EV/reserves with the reserves being estimated from the acreage, as explicit reserves data is unavailable. Comparing it to its peers, we arrive at a fair value of CAD$0.56 for the stock, which provides an upside potential of 46.3% over its current price of CAD$0.38. We have raised a one-year target price for the company from CAD$0.24–CAD$0.56 due to rise in mining assets and progress on its exploration activities for various projects."

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