The BHP Group Ltd (ASX: BHP) share price has been in freefall through August.
Shares in the resources giant finished July at $53.49. They’ve since dropped to trade at $45.75 apiece. That’s a drop of 14.47%.
Let’s take a look at what’s been weighing on the ASX 200 giant.
The month that’s been for the BHP share price
The BHP share price has slipped 14.5% this month. The big news that has been moving it is the company’s plan to merge with Woodside Petroleum Limited (ASX: WPL).
The proposal came to light alongside BHP’s full-year results. It would see BHP merge its oil and gas assets with Woodside, while Woodside would provide new shares to BHP shareholders.
The end goal would see BHP’s shareholders with a 48% holding in Woodside.
While BHP’s shares slid just 1.4% on the day it broke the news, they fell another 12.9% over the 2 following sessions.
In addition to its controversial merger plan, the BHP share price has been weighed down by investors worried about its concerning climate commitments and its project development plans.
BHP has been forced to put its climate commitments to a shareholder vote at its annual general meeting. The vote was called for by the Australasian Centre for Corporate Responsibility (ACCR), a shareholder advocacy group.
The group is representing BHP’s shareholders. It’s calling for a review into the company’s links with lobby groups advocating against the goals of the Paris Agreement.
Additionally, in early August the company announced it will spend US$544 million at its Shenzi North project, as well as US$258 million on its Trion project’s front end engineering design (FEED) phase.
Finally, the price of iron ore is undoubtedly dragging on the BHP share price.
The iron ore price has fallen 24% over the last month. Right now, a tonne of iron ore will set a buyer back US$159.58.
The post The BHP (ASX:BHP) share price is down 14% in a month. Here’s why appeared first on The Motley Fool Australia.
Should you invest $1,000 in BHP Group right now?
Before you consider BHP Group, you’ll want to hear this.
Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and BHP Group wasn’t one of them.
The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.
*Returns as of August 16th 2021
More reading
- Fortescue (ASX:FMG) share price bounces despite looming iron ore supply outlook
- The materials sector is leading ASX 200 shares today
- ASX 200 Weekly Wrap: A mixed bag of earnings dominates ASX
- If you invested $1,000 in BHP (ASX:BHP) shares a decade ago, here’s what it would be worth now
- BHP (ASX:BHP) share price flat despite rebound in iron ore prices
Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
from The Motley Fool Australia https://ift.tt/2Ydcaxm
Leave a Reply