broker recommendation, page-4

http://www.nationalpost.com/capital+starts+coverage+gold+with+outperform+rating/6053352/story.html

While the Gold Coast of west Africa is rich with mining prospects and explorers, RBC Capital Markets suggests investors will strike gold if they go with developer PMI Gold Corp.

Steuart McIntyre, analyst with RBC, has initiated coverage on the Australian company, listed on the TSX-Venture exchange in Canada, with an outperform rating. He lists a A$1.80 ($1.92) target price with an 80% implied return.

"In our view, the company is characterized by its large, above average grade resource base, experienced team and compelling relative value," Mr. McIntyre said.

There are several potential near-term catalysts for PMI Gold's 4.5 million ounce Obotan gold mine in Ghana. These include a possible resource upgrade and completion of a bankable feasibility study by the end of the second quarter in 2012. If PMI matches these marks, the analyst said he would increase the target price to A$2.50 with a 150% return.

The site's pre-feasibility study completed earlier this month certainly shows promise, with Mr. McIntyre describing it as "robust" suggesting an estimated post-tax implied rate of return of 40%.

PMI expects Obotan to begin producing gold in the first quarter of 2014.

The company's Kubi mine project, another "potential sleeper" under development, also looks promising, he said.

Moreover, PMI has a strong relative value with 4.8 million ounces in resources at a higher grade of 2.4 g/t compared with the average in West Africa which is closer to 1.8 g/t.

Mr. McIntyre believes the company also represents an attractive takeover target naming Perseus, Endeavour, Golden Star and Noble Minerals as top potential suitors.