Why is everyone talking about BHP shares this week?

BHP Group (ASX: BHP) shares are the talk of the town among investors and analysts alike this week. 

The Australian mining and metals giant’s shares have climbed 1.06% in Wednesday afternoon trading. At the time of writing, the shares are changing hands at $44.77 a piece. That’s a 31% increase from a 3.5-year low in April. The shares are 12.04% higher for the year to date.

The miner’s shares have come under the spotlight recently. Last week, the mining giant made the list as the second most-traded ASX share among CommSec clients. Although a huge 80% of activity was investors selling up the mining giant’s stock, potentially from investors taking their latest gains off the table. 

What’s all the fuss about?

It’s been a big week for BHP.

The copper price hit a new all-time high of US$11,600 per tonne on the London Metal Exchange on Monday, bumping up BHP’s valuation. The metal has now gained more than 30% since the start of the year, comfortably outpacing the broader market.

Copper is a central material for the global energy transition, with significant use in electric vehicles and associated charging infrastructure. It is also a critical component in AI data centres thanks to its conductivity and efficiency in power distribution and cooling. And as the world’s largest copper producer, BHP’s share price and company strength are very closely tied to the metal’s price fluctuations.

In other news, the mining giant has struck up a new US$2 billion infrastructure agreement tied to its Western Australia Iron Ore (WAIO) operations.

According to the miner’s release yesterday, BHP has entered into a binding deal with Global Infrastructure Partners (GIP), an investment group owned by BlackRock, the world’s largest asset manager, which handles more than $12.5 trillion in assets.

Under the arrangement, a new trust will be set up, with BHP owning and controlling 51% and GIP holding the remaining 49%. The project is due for completion by the end of FY26, subject to approvals.

Management stated that the proceeds from the agreement will be evaluated and deployed in accordance with BHP’s capital allocation framework. 

What’s next for BHP shares?

Analysts are relatively uncertain about the outlook for BHP shares. Data shows that out of 19 analysts, 12 have a hold rating on the mining giant’s stock. Another 6 have a buy or strong buy rating, while 1 analyst has a strong sell rating.

The average target price for BHP shares is $44.94, although some think it could rise to as high as $47.80 over the next 12 months. At the time of writing, this implies a potential upside of up to 6.87%.

The post Why is everyone talking about BHP shares this week? appeared first on The Motley Fool Australia.

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• Up 24% in a year! The red-hot Telstra share price is smashing BHP, Westpac and Coles

Motley Fool contributor Samantha Menzies has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended BlackRock. The Motley Fool Australia has recommended BHP Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.