Here’s the BHP dividend forecast through to 2026

Man in yellow hard hat looks through binoculars as man in white hard hat stands behind him and points.

Man in yellow hard hat looks through binoculars as man in white hard hat stands behind him and points.Earlier this week, BHP Group Ltd (ASX: BHP) released its full year results and rewarded its shareholders with another huge dividend.

For the 12 months ended 30 June, the mining giant will pay total fully franked dividends of US$3.25 per share.

This was well ahead of the market’s expectations and is being underpinned by the record free cash flow the mining giant generated during FY 2022.

Investors may now be wondering where the BHP dividend is heading from here. So, let’s take a look to see what analysts are forecasting.

Where is the BHP dividend going from here?

According to a note out of Goldman Sachs, its analysts believe the BHP dividend may have peaked for the time being.

Nevertheless, the broker is still expecting the Big Australian’s shares to provide above-average yields for the foreseeable future.

In FY 2023, Goldman is forecasting a US$1.62 (A$2.34) per share fully franked dividend. Based on the current BHP share price, this will mean a yield of 5.75%.

The following year, in FY 2024, the broker is expecting the BHP dividend to reduce again. It has pencilled in a US$1.54 (A$2.23) per share fully franked dividend. This equates to a 5.5% dividend yield at current prices.

Moving on, in FY 2025, a fully franked US$1.41 (A$2.04) per share dividend is expected. This will mean a yield of 5% for investors in that financial year.

Finally, in FY 2026, Goldman Sachs is forecasting a US$1.24 (A$1.79) per share fully franked dividend. At current levels, this will mean a yield of 4.4% for investors.

All in all, Goldman doesn’t expect the BHP dividend yield to fall below 4% between now and 2026, which is good news for income investors.

The post Here’s the BHP dividend forecast through to 2026 appeared first on The Motley Fool Australia.

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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.

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