Why BHP shares just got a big buy call

BHP Group Ltd (ASX: BHP) shares have enjoyed a tremendous run over the past year.

In Monday afternoon trade, shares in the S&P/ASX 200 Index (ASX: XJO) mining giant were up 0.6%, trading for $62.71 apiece.

That sees the ASX 200 stock up 66% over the past 12-months, smashing the 3.5% one-year gains posted by the benchmark index.

Atop those capital gains, BHP has also paid out two fully-franked dividends totalling a (rounded) $1.96 a share. BHP shares trade on a fully-franked 3.1% trailing dividend yield at the time of writing.

Taking those franking credits into account, the grossed-up dividend yield is 4.5%.

And looking ahead, Red Leaf Securities’ John Athanasiou believes Australia’s biggest mining stock is well-positioned to keep outperforming (courtesy of The Bull).

Here’s why.

Should you buy BHP shares today?

According to Athanasiou:

Iron ore sales continue to drive earnings, but the key long-term story is copper, where demand is structurally supported by electrification, grid investment and artificial intelligence related infrastructure.

Consequently, it gradually shifts BHP from a traditional cyclical miner towards a more diversified industrial metals compounder.

Athanasiou is also bullish on the outlook for BHP’s future passive income payments.

“Cash generation remains strong, supporting consistent dividends and capital management,” he said.

Summarising his buy recommendation on BHP shares, Athanasiou concluded:

The balance sheet is conservative, allowing flexibility through the cycle. While iron ore is still exposed to Chinese demand volatility, BHP’s scale and low-cost positioning provide downside protection.

What’s happening with the ASX 200 miner’s copper ambitions?

Over the past 12 months, the copper price has surged 42%, trading for US$13,636 per tonne on Monday afternoon.

And with global copper prices likely to remain strong due to electrification, grid investment, and artificial intelligence-related infrastructure demands Athanasiou mentioned above, many big Aussie miners have been working hard to increase their exposure to the red metal.

BHP has been leading the charge, with the miner producing 984,000 tonnes of copper in the first half of the financial year (H1 FY 2026). This saw copper bringing in more than half of BHP’s earnings for the first time.

The company reported underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) from its copper division of US$8 billion in H1. That was up 59% year on year, and it saw copper contribute 51% of BHP’s half-year underlying EBITDA.

And, as CEO Mike Henry revealed following the miner’s Q3 results release on 22 April, BHP shares are on track to continue increasing their exposure to the red metal.

“In copper, strong performance at Escondida and Antamina supports our expectation of delivering production in the upper half of FY26 group copper guidance,” Henry said.

BHP’s full-year copper production guidance is between 1.9 million tonnes and 2.0 million tonnes.

The post Why BHP shares just got a big buy call appeared first on The Motley Fool Australia.

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Motley Fool contributor Bernd Struben 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 recommended BHP Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.