BHP Group (BHP) AI Stock Analysis

• Market Cap: $118.26B
• Dividend Yield: 5.27%
• Average Volume (3M): 3.74M
• Price to Earnings (P/E): 10.4
• Beta (1Y): 0.95
• Revenue Growth: -3.15%
• EPS Growth: 54.08%
• Country: US
• Employees: 38,962
• Sector: Basic Materials
• Sector Strength: 56
• Industry: Industrial Materials
• EPS (TTM): 4.48
• Shares Outstanding: 2,537,996,000
• 10 Day Avg. Volume: 5,182,339
• 30 Day Avg. Volume: 3,742,561
• PEG Ratio: 0.19
• Price to Book (P/B): N/A
• Price to Sales (P/S): 2.33
• Price to Cash Flow (P/CF): 7.50
• P/FCF Ratio: 16.60
• 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: $53.38
• Price Target Upside: 14.82% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5

BHP Group holds a strong financial position with solid profitability and a stable balance sheet. Valuation factors like an attractive P/E ratio and high dividend yield are significant positives. However, the technical indicators suggest bearish momentum, requiring attention. The primary concern is the declining revenue trend, influencing the overall score.

BHP Group Business Overview & Revenue Model

Company Description

BHP Group Limited operates as a resources company in Australia, Europe, China, Japan, India, South Korea, the rest of Asia, North America, South America, and internationally. The company operates through Copper, Iron Ore, and Coal segments. It engages in the mining of copper, uranium, gold, zinc, lead, molybdenum, silver, iron ore, cobalt, and metallurgical and energy coal. The company is also involved in the mining, smelting, and refining of nickel, as well as potash development activities. In addition, it provides towing, freight, marketing and trading, marketing support, finance, administrative, and other services. The company was founded in 1851 and is headquartered in Melbourne, Australia.

How the Company Makes Money

BHP Group generates revenue primarily through the extraction and sale of commodities such as iron ore, copper, coal, and petroleum. Iron ore is one of the company's most significant revenue streams, driven by demand from the steel manufacturing industry, particularly in China. Copper is another major contributor, with its applications in electrical equipment and construction ensuring steady demand. BHP also profits from its coal operations, which include both metallurgical coal used in steel production and thermal coal for power generation. In the petroleum sector, BHP extracts crude oil and natural gas, which are sold on global markets. The company's revenue model is bolstered by its strategic partnerships and joint ventures with other major industry players, enabling it to optimize production and expand market reach. Additionally, BHP invests in technology and innovation to improve operational efficiency and reduce costs, further enhancing its profitability.

BHP Group Financial Statement Overview

Summary

BHP Group exhibits a strong financial position with healthy profitability margins and a stable balance sheet. While cash flow generation remains robust, the decline in revenue growth over recent years is concerning and needs to be addressed to maintain competitive edge and ensure sustained growth.

Income Statement

BHP Group has demonstrated a strong financial performance with a solid gross profit margin of 82.3% and a respectable net profit margin of 14.1% for the 2024 period. However, the revenue growth has been a concern with a decline of 14% from 2022 to 2024. EBIT and EBITDA margins remain solid at 31.3% and 42.0% respectively, indicating efficient operational management. The declining trend in revenue requires attention to ensure future stability.

Balance Sheet

The company's balance sheet is robust, with a debt-to-equity ratio of 0.45 for 2024, showcasing a conservative leverage approach. Return on Equity (ROE) is relatively strong at 17.6%, indicating effective use of shareholder capital. The equity ratio stands at 43.8%, reflecting a healthy level of equity financing. Overall, the balance sheet stability supports sustainable operations.

Cash Flow

BHP Group's cash flow statements reveal a commendable operating cash flow to net income ratio of 2.62, indicating strong cash generation capabilities. Free cash flow growth from 2023 to 2024 is modest at 2.0%. The company's free cash flow to net income ratio of 1.50 underscores its ability to generate ample free cash relative to net income. However, the lower growth in free cash flow merits monitoring.

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
31.03B	46.10B	27.66B	39.71B	34.04B	20.43B
	EBIT
21.66B	17.54B	22.06B	33.02B	32.30B	15.72B
	EBITDA
25.71B	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
10.56B	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 Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 46.49
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BHP, the sentiment is Negative. The current price of 46.49 is below the 20-day moving average (MA) of 46.53, below the 50-day MA of 48.39, and below the 200-day MA of 51.38, indicating a bearish trend. The MACD of -0.96 indicates Negative momentum. The RSI at 49.13 is Neutral, neither overbought nor oversold. The STOCH value of 89.03 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for BHP.

BHP Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RIO	74 Outperform	$97.72B	8.01	20.93%	6.87%	-0.81%	14.59%
VALE	72 Outperform	$38.86B	6.65	16.72%	8.20%	-8.71%	-22.75%
BHP	69 Neutral	$118.26B	10.38	26.13%	5.27%	-3.15%	54.08%
MP	69 Neutral	$4.31B	―	-5.41%	―	-19.57%	-392.96%
MTRN	61 Neutral	$1.64B	279.92	0.67%	0.69%	1.19%	-93.81%
NEXA	51 Neutral	$803.90M	―	-20.22%	―	6.28%	29.57%
Sector *	48 Neutral	$1.91B	-1.66	-22.29%	3.86%	0.68%	-27.44%