A summer of good news has continued into the fall for Denison Mines (TSX:DML,NYSE:DNN). On Wednesday the company announced that it has extended the Gryphon Zone of its Wheeler River property and has concluded its 2014 summer drilling programs at Wheeler River, Crawford Lake and Bachman Lake.
Denison has now drilled a total of 14,397 meters in 20 holes in the Gryphon Zone. The Gryphon Zone measures 350 meters by 60 meters, with thicknesses that remain open in both plunge directions. The latest results include the promising WR-573D1 hole, which intersected 15.8 percent eU3O8 over 2.3 meters, and WR-574, which intersected 7 percent eU3O8 over 2 meters, followed by 9.8 percent eU3O8 over 2.5 meters.
"We are very encouraged by the Gryphon zone results to date. In a relatively short time we have been able to gain an understanding of the geology surrounding a newly discovered zone of high grade uranium mineralization on our flagship Wheeler River project," said Ron Hochstein, president and CEO of the company, in a press release.
Results exciting analysts
WR-573D1 was drilled to a depth of 767.2 meters and intersected some high-grade material, with analysts encouraged by what the company reported.
Colin Healy with Haywood Securities said the most recent news had a "positive impact" in a research note and wrote that "the Gryphon Zone has the potential to add real pounds to the already impressive Wheeler River project."
The sentiment was echoed by Cantor Fitzgerald analyst Rob Chang.
"In our minds, it's shaping up to be a world class asset," said Chang in an interview with Uranium Investing News. He added that it is encouraging that the company continues to find intercepts in the Gryphon Zone and is also increasing the size of its deposit.
In a research note, Chang noted that a declining uranium price has somewhat hampered the company's share price, but it is still outperforming the uranium market as a whole. In fact, the company is up 2.33 percent year to date.
Summer of promise
Denison holds more than 470,000 hectares of property in the Athabasca Basin, widely considered Canada's premier uranium hotspot. It owns 60 percent of the Wheeler River property with Cameco (TSX:CCO,NYSE:CCJ) holding 30 percent and JCU (Canada Exploration) holding the final 10 percent.
Over the course of the summer, Denison came out with a series of promising moves. It gave a resource update in June (the first increase since 2012), announced the results of its summer drilling program and acquired International Enexco, which brought with it stakes in both the Mann Lake and Bachman Lake projects. The company also raised nearly $15 million through a flow-through common share deal in August. The money has already been earmarked to cover the company's 2015 exploration program.
Both Chang and Healy listed the company's shares with a recommendation of "buy," with Healy estimating a target share price of $2.10 over the course of the next year.
Denison has drilled 2,995 meters in five holes at Crawford Lake and 1,194 meters in two holes at Bachman Lake, with both properties showing no significant mineralization. The company said drilling at Crawford Lake did extend a large zone of sandstone and basement alteration with follow-up drilling planned for 2015.
Wednesday's news brought with it a 2.3-percent bump in Denison's share price, raising it to $1.32 by market close.