BHP Group Ltd (BHP) AI Stock Analysis

• Market Cap: $191.72B
• Dividend Yield: 5%
• Average Volume (3M): 8.20M
• Price to Earnings (P/E): 11.1
• Beta (1Y): 1.03
• Revenue Growth: -2.47%
• EPS Growth: 57.01%
• Country: AU
• Employees: 38,962
• Sector: Basic Materials
• Sector Strength: 64
• Industry: Industrial Materials
• EPS (TTM): 1.55
• Shares Outstanding: 5,075,992,000
• 10 Day Avg. Volume: 8,320,917
• 30 Day Avg. Volume: 8,195,032
• PEG Ratio: 0.23
• Price to Book (P/B): 2.59
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 11.34
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $41.74
• Price Target Upside: 11.13% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 16

• Rating: 72 Outperform
• Price Target: AU$42.00 ▲(11.82%Upside)

The overall stock score for BHP Group Ltd is driven by its strong financial performance, characterized by robust cash flow and solid margins, despite slowing revenue and net profit growth. The valuation is attractive with a reasonable P/E ratio and a high dividend yield. Technical analysis indicates a neutral to slightly bullish trend, balancing the overall outlook.

Positive Factors

Copper Production

Copper production is strong and performing well against expectations.

Dividends

BHP declared an interim dividend of 50 UScps, +2% versus consensus.

Earnings

BHP has reported 1H FY25 results with underlying EBITDA of $12.4bn, in line with consensus of $12.3bn.

Negative Factors

Coal Production

Met coal production is weaker than expected due to high rainfall.

Cost Guidance

Increase in cost guidance for coal production due to weather challenges and operational issues.

Net Debt

Net debt is expected to rise to around the top end of the target range following completion of the $2.0bn Vicuña transaction and payment of the 2H Samarco settlement obligations.

BHP Group Ltd Business Overview & Revenue Model

Company Description

BHP Group Ltd (BHP) is a leading global resources company headquartered in Australia. It is primarily involved in the extraction and processing of minerals, oil, and gas. BHP's core products include iron ore, copper, coal, nickel, and petroleum, serving vital sectors such as steel production, energy, and manufacturing. With operations spanning across several continents, BHP is committed to sustainable practices and innovation in resource extraction and management.

How the Company Makes Money

BHP Group Ltd makes money through the exploration, production, and sale of natural resources. Its key revenue streams include the sale of iron ore, which is primarily used in steelmaking, and copper, essential for electrical equipment and construction. Additionally, BHP generates significant income from its petroleum operations, extracting and selling oil and gas. The company has strategic partnerships and long-term contracts with industrial clients worldwide, ensuring stable demand for its resources. Market prices for commodities and operational efficiency are significant factors influencing BHP's earnings, alongside its ongoing investments in technology and sustainability to enhance production capabilities.

BHP Group Ltd Financial Statement Overview

Summary

BHP Group Ltd shows a strong financial profile with robust cash flow generation and solid profitability margins, though there is a noted decline in net profit margins and revenue growth. The balance sheet is stable with moderate leverage and strong equity. While the company demonstrates operational efficiency, attention to maintaining revenue and profit growth is advisable to sustain financial strength.

Income Statement

BHP Group Ltd demonstrated strong profitability with a Gross Profit Margin of 82.24% and an EBIT Margin of 31.29% in 2024. However, there was a noticeable decline in Net Profit Margin to 14.09% from 24.01% in 2023, indicating pressure on net profitability. Revenue growth was modest at 4.10% from 2023 to 2024, trailing previous years. While the EBITDA Margin remains robust at 41.98%, the slowdown in revenue growth and net income warrants attention.

Balance Sheet

BHP maintains a stable financial position with an Equity Ratio of 43.79% and moderate leverage, evidenced by a Debt-to-Equity Ratio of 0.45. The Return on Equity was 17.62% in 2024, indicating efficient use of equity despite a decline from 29.04% in 2023. The company's strong equity base and manageable debt levels provide a solid foundation, although the slight decrease in ROE suggests reduced profitability.

Cash Flow

The company's cash flow remains robust, with a 2.00% growth in Free Cash Flow from 2023 to 2024. The Operating Cash Flow to Net Income Ratio of 2.62 highlights strong operational efficiency. The Free Cash Flow to Net Income Ratio of 1.50 in 2024 indicates effective cash generation relative to net income. Overall, the cash flow performance is excellent, with consistent free cash flow growth and high operational cash inflow.

Breakdown
TTM	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement		Total Revenue
53.75B	56.03B	53.82B	65.10B	56.92B	42.93B
	Gross Profit
31.35B	46.10B	27.66B	39.71B	34.04B	20.43B
	EBIT
21.86B	17.54B	22.06B	33.02B	32.30B	15.72B
	EBITDA
25.57B	23.52B	27.12B	38.64B	30.23B	18.05B
	Net Income Common Stockholders
11.39B	7.90B	12.92B	22.74B	11.30B	7.96B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
16.60B	12.65B	12.46B	17.54B	15.25B	13.46B
	Total Assets
98.27B	102.36B	101.30B	95.17B	108.93B	105.73B
	Total Debt
15.96B	20.18B	22.34B	16.43B	20.98B	27.05B
	Net Debt
-200.00M	7.79B	9.92B	-808.00M	5.74B	13.62B
	Total Liabilities
41.28B	53.24B	52.77B	46.40B	53.32B	53.56B
	Stockholders Equity
56.09B	44.81B	44.50B	44.96B	51.26B	47.87B
Cash Flow		Free Cash Flow
10.36B	11.85B	11.62B	26.06B	21.43B	8.07B
	Operating Cash Flow
20.10B	20.66B	18.70B	32.17B	27.23B	15.71B
	Investing Cash Flow
-9.35B	-8.76B	-13.06B	-6.96B	-7.84B	-7.62B
	Financing Cash Flow
-10.96B	-11.67B	-10.31B	-22.77B	-17.92B	-9.75B

BHP Group Ltd Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 37.56
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:BHP, the sentiment is Negative. The current price of 37.56 is below the 20-day moving average (MA) of 38.49, below the 50-day MA of 37.89, and below the 200-day MA of 39.37, indicating a bearish trend. The MACD of 0.01 indicates Positive momentum. The RSI at 42.52 is Neutral, neither overbought nor oversold. The STOCH value of 10.04 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AU:BHP.

BHP Group Ltd Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FMG	76 Outperform	$46.16B	7.80	20.21%	9.16%	-11.33%	-32.11%
RIO	74 Outperform	$155.52B	10.26	21.04%	8.19%	-0.10%	15.50%
ILU	72 Outperform	$1.55B	6.67	10.39%	2.25%	-9.35%	-32.77%
BHP	72 Outperform	$191.72B	11.09	26.20%	5.00%	-2.47%	57.01%
S32	60 Neutral	£13.22B	58.57	-3.53%	3.62%	-19.74%	―
MIN	56 Neutral	$3.82B	50.78	-33.95%	4.54%	2.22%	-411.10%
Sector *	50 Neutral	$2.00B	-1.12	-21.15%	3.68%	2.69%	-30.65%

BHP Group Ltd Corporate Events

BHP Group Ltd Announces Change in Substantial Shareholder Interests

BHP Group Ltd has announced a change in the interests of its substantial shareholder, Citigroup Global Markets Australia Pty Limited, and its related entities. The notice reveals a decrease in Citigroup’s voting power from 6.2999% to 5.2988% due to various transactions involving Citibank, N.A., and its branches, as well as Citigroup Global Markets Funding Luxembourg S.C.A. These changes reflect routine adjustments in shareholding positions through standard market transactions and securities lending agreements.

The most recent analyst rating on (AU:BHP) stock is a Hold with a A$25.50 price target. To see the full list of analyst forecasts on BHP Group Ltd stock, see the AU:BHP Stock Forecast page.

BHP Group Director Increases Stake in Company Shares

BHP Group Limited has announced a change in the director’s interest, with Dion Weisler acquiring 1,450 ordinary shares indirectly through Dish Nominees Pty Ltd, a private investment entity for the Weisler family. This on-market purchase increases Weisler’s indirect holdings, reflecting a strategic move that could signal confidence in the company’s future performance, potentially impacting stakeholder perceptions and market positioning.

BHP Director Increases Stake with Additional Share Acquisition

BHP Group Limited announced a change in the director’s interest, with Ross McEwan acquiring an additional 10,000 ordinary shares in the company, bringing his total indirect holdings to 45,000 shares. This acquisition, conducted through an on-market purchase, reflects a notable increase in McEwan’s stake in the company, potentially signaling confidence in BHP’s future performance and stability, which could positively influence stakeholder sentiment.

BHP Group Issues Over 2 Million New Securities as Part of Employee Incentive Scheme

BHP Group Limited has announced the issuance of 2,091,047 ordinary fully paid securities, which will be quoted on the Australian Securities Exchange (ASX). This move is part of an employee incentive scheme, indicating BHP’s ongoing efforts to align employee interests with company performance. The issuance of these securities may enhance BHP’s market liquidity and reflects the company’s commitment to rewarding its workforce, potentially impacting its operational dynamics and stakeholder relations positively.

Ken MacKenzie Retires from BHP Group Board

Ken MacKenzie has retired from his role as an independent Non-executive Director of BHP Group Ltd as of March 31, 2025. This change in the board could influence the company’s governance and strategic direction, potentially impacting stakeholders and the company’s positioning in the resources sector.

BHP Group Updates Dividend Distribution Details

BHP Group Ltd announced an update to its previous dividend distribution notification, providing details on currency rates and conversions for AUD, GBP, and NZD. This update pertains to the dividend for the six-month period ending December 31, 2024, with key dates including a record date of March 7, 2025, and a payment date following shortly after. The announcement reflects BHP’s ongoing commitment to transparency and shareholder engagement, potentially impacting investor relations and market perceptions.