Canaccord raises target to $5

METALS AND MINING

Hathor Exploration Limited | Eric Zaunscherb, CFA, 1.604.699.0829

HAT : TSX-V : C$3.12 | C$334.2M | Speculative Buy , Target C$5.00 ­

· Major resource beat: raising target to C$5.00 (from C$4.50) and maintaining SPECULATIVE BUY rating

Rated SPECULATIVE BUY for exposure to one of the most important high-grade uranium discoveries in the past decade

Release of the updated Roughrider resource estimate on Tuesday delivered 27.9 million pounds U3O8 overall, including 24.2 million pounds in a high-grade core averaging 11.6%. This puts the 90%-owned Midwest NorthEast project in an elite category of high-grade deposits in the Athabasca Basin of Saskatchewan.

Hathor’s share price has appreciated 82% since the beginning of October, or 121% since the beginning of July, but…

· There are important valuation implications from the new resource that drive our valuation and target price higher.

· We expect strong news flow as Hathor delivers assays from the summer Midwest NE program, assays from the Russell Lake project, and an initial Roughrider East resource.

· Momentum is building in junior uranium equities as the spot price passes through US$60/lb.

New C$5.00 target delivers 60% projected return

Our mine model is based on a conceptual 48 million pound resource, valued using a cash flow analysis discounted at 10%. Taking into account corporate adjustments generates a corporate NAV of C$1.1 billion, or C$6.16 per share. Applying a 0.8x multiple to Hathor’s corporate NAV produces our new C$5.00 price target