The 19-year-old scored 11 goals during a loan stint with Tranmere Rovers earlier in the season and reports had linked the League One outfit with making another approach for Cassidy to return until the end of the campaign.
However, having seen the striker up close in training, Saunders has admitted that he has been impressed with what he has seen.
"Jake is going to be a good player. I've worked with him now for three or four weeks and he can do most things. He's got a lot of tools and I think he's going to play his part for us this season," said Saunders.
"Unless we go out and get a couple of centre-forwards, he's going to have to. But he's definitely got a goal in him, he can score all types of goals and it wouldn't surprise me if he played on Saturday and scored a hat-trick. It also wouldn't surprise me if he came off the bench and got a goal for us."
Cassidy joined Wolves in 2010 from Welsh club Airbus UK.