The BHP Group Ltd (ASX: BHP) share price had a tough month in June.
During the period, the mining giantâs shares dropped 7.5%.
Though, this is actually better than the ASX 200 index, which tumbled 9% over the same period.
Why did the BHP share price tumble lower in June?
As well as battling broad market weakness, the BHP share price came under pressure from a pullback in the iron ore price.
For example, on Thursday the price of iron ore for September delivery fell a further 2.7% on Chinaâs Dalian Commodity Exchange. This put the steel-making ingredient on track to record a quarterly loss of approximately 11%.
In addition, the copper price has come under pressure significant pressure. So much so, the metal tumbled again on Thursday to record its biggest quarterly slump since 2011. This has been driven by concerns that a recession could impact demand.
Finally, the announcement of new coal royalties in Queensland weighed on mining shares during the month.
Is this a buying opportunity?
Analysts at Goldman Sachs appear to see the weakness in the BHP share price as a buying opportunity.
A note from earlier week reveals that its analysts have resumed coverage on the Big Australian with a buy rating and $49.40 price target.
This implies potential upside of 22% for investors over the next 12 months from current levels.
In addition, Goldman Sachs is forecasting fully franked dividends per share of US$3.50 in FY 2022 and then ~US$2.65 in FY 2023. Based on the current BHP share price and current exchange rates, this implies yields of 12.5% and 9.5%, respectively.
All in all, this suggests that thereâs a total potential return on offer of almost 35% for investors over the next 12 months.
The post Why did the BHP share price take a tumble in June? appeared first on The Motley Fool Australia.
Should you invest $1,000 in Bhp Group Ltd right now?
Before you consider Bhp Group Ltd, 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 Ltd wasn’t one of them.
The online investing service heâs run for over 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.
See The 5 Stocks
*Returns as of June 1 2022
(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}
setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()
More reading
- These ASX 200 mining shares are digging a deeper hole on Friday
- Best ASX shares to buy in July 2022
- How have ASX 200 mining shares fared over June?
- Here are 2 top ASX 200 dividend shares to buy right now according to experts
- Which ASX 200 mining share offers the best dividend yield for FY22?
Motley Fool contributor James Mickleboro 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 Scott Phillips.
from The Motley Fool Australia https://ift.tt/xs0aed5
Leave a Reply