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BHP Group Ltd ADR BHP

Morningstar Rating
$61.47 +1.45 (2.42%)
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Company Report

Anglo American Proposes to Slim Down to Copper and Iron Ore to Fend off BHP

In response to no-moat BHP’s overtures, no-moat Anglo American proposes restructuring to focus on its copper and iron ore operations while selling or spinning off its other businesses, including platinum group metals, De Beers, or diamonds, and metallurgical coal. It would also keep the Woodsmith polyhalite project in the United Kingdom. Along with selling its coal business, another major difference to BHP’s proposal is that Anglo will retain its 69.7% stake in Kumba Iron Ore in South Africa. The restructure would essentially cut Anglo’s business in half, with copper and iron ore operations currently accounting for around half of our forecast EBITDA midcycle from 2028.

Price vs Fair Value

BHP is trading at a 864% premium.
Price
$61.47
Fair Value
$17.00
Uncertainty
Medium
1-Star Price
$39.10
5-Star Price
$36.90
Economic Moat
Tqd
Capital Allocation
Hvwprtqjx

Bulls Say, Bears Say

Bulls

BHP is a beneficiary of continued global economic growth and demand for the commodities it produces.

Bears

BHP has shown improved capital allocation since its mis-steps during the China boom, but continuing high commodity prices could encourage it to once again aggressively expand output.

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News

Trading Information

Previous Close Price
$60.02
Day Range
$60.1861.61
52-Week Range
$54.2869.11
Bid/Ask
$61.44 / $62.00
Market Cap
$155.87 Bil
Volume/Avg
3.5 Mil / 2.6 Mil

Key Statistics

Price/Earnings (Normalized)
11.28
Price/Sales
2.75
Dividend Yield (Trailing)
5.07%
Dividend Yield (Forward)
5.07%
Total Yield
4.95%

Company Profile

BHP is a global diversified miner mainly supplying iron ore and copper. The merger of BHP Limited and Billiton PLC created the present-day BHP Group. The dual-listed structure from the 2001 BHP and Billiton merger was collapsed in 2022. Major assets include Pilbara iron ore and Escondida copper. Onshore US oil and gas assets were sold in 2018 and the remaining Petroleum assets were spun off and merged with Woodside in 2022, with BHP vesting the Woodside shares it received to BHP shareholders. BHP is growing its nickel business to supply more battery-grade nickel and is also entering the potash market through the development of its Jansen mine in Canada. It also purchased copper miner Oz Minerals in fiscal 2023.
Sector
Basic Materials
Industry
Other Industrial Metals & Mining
Stock Style Box
Large Value
Total Number of Employees
42,319

Competitors

Valuation

Metric
BHP
VALE
RIO
Price/Earnings (Normalized)
11.286.7012.17
Price/Book Value
3.671.452.68
Price/Sales
2.751.312.65
Price/Cash Flow
7.134.098.65
Price/Earnings
BHP
VALE
RIO

Financial Strength

Metric
BHP
VALE
RIO
Quick Ratio
1.080.441.04
Current Ratio
1.571.121.69
Interest Coverage
7.598.778.04
Quick Ratio
BHP
VALE
RIO

Profitability

Metric
BHP
VALE
RIO
Return on Assets (Normalized)
13.90%10.67%11.84%
Return on Equity (Normalized)
31.67%25.34%22.48%
Return on Invested Capital (Normalized)
21.70%18.70%19.38%
Return on Assets
BHP
VALE
RIO
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Other Industrial Metals & Mining Industry Comparables

Ticker
Name
Morningstar Rating for Stocks
Capital Allocation
Economic Moat
Market Cap
BHPLF
BHP Group LtdZQzltkd$152.1 Bil
RTNTF
Rio Tinto LtdBqsd$143.4 Bil
RIO
Rio Tinto PLC ADRRmyxlbxqBtx$116.4 Bil
VALE
Vale SA ADRZxnHsxm$55.2 Bil
NGLOY
Anglo American PLC ADRTrjjwcgvHhnt$41.1 Bil
TECK
Teck Resources Ltd Class B (Sub Voting)BbqpfnlRkpz$27.9 Bil
LAC
Lithium Americas CorpPqkfvvklDgy$963.0 Mil
LAAC
Lithium Americas (Argentina) CorpKrlmsjthQnfkbb$814.6 Mil
CMP
Compass Minerals International IncMdzghnmBrbbdyk$524.1 Mil

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