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The Wesfarmers Ltd (ASX: WES) share price has had a rough time recently and investors have it firmly on watch.

In early trade this morning, the Wesfarmers share price is in positive territory. It’s up 0.96% to $55.84.

So, why are investors paying such close attention to the Wesfarmers share price?

Investors waiting for Wesfarmers to make next move on API

The Wesfarmers share price has been rocked by various events in this past week.

Most notably was the news of a rival bid for Australian Pharmaceutical Industries Ltd (ASX: API).

Listed pharmaceutical company Sigma Healthcare Ltd (ASX: SIG) entered the race with a bid for 100% of API shares at $1.57 per share.

Sigma’s offer includes cash of 35 cents per share and 2.05 Sigma shares per API share.

By comparison, Wesfarmers recently sweetened its bid to acquire API, tabling an offer of $1.55 per share under a revised scheme arrangement.

As a result, a bidding war has emerged with both Sigma and Wesfarmers simultaneously undertaking due diligence.

The higher bid from Sigma has awakened speculation that Wesfarmers could lob a higher cash bid.

Interestingly, API’s major shareholder Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) could have a role to play.

Soul Patts has agreed to vote its 19.3% shareholding in API in favour of Wesfarmers’ revised proposal. 

As a result, the conglomerate has the right to exercise a call option if it matches a bid by Sigma.

However, there remains uncertainty as to what form an equivalent offer could take.

More on the Wesfarmers share price

Up until recently, the Wesfarmers share price was having a stellar year.

However, in the past month shares in the conglomerate have fallen more than 16% from their record highs.

The main catalyst can be attributed to the conglomerate’s full-year report.

Despite delivering solid growth in FY21, Wesfarmers flagged that earnings in the group’s retail businesses for the first half of FY22 may be below the prior corresponding period.

As a result, investors may be questioning the outlook for shares in Wesfarmers.

The post Wesfarmers (ASX:WES) share price in focus as investors await next move appeared first on The Motley Fool Australia.

More reading

• Here are 2 ASX dividend shares that could provide steady passive income
• Why Sigma, Smartgroup, St Barbara, & Touch Ventures are pushing higher
• Wesfarmers (ASX:WES) share price wobbles amid rival bid for API
• Why AVZ, Flight Centre, Fortescue, & Sigma shares are storming higher
• Woolworths (ASX:WOW) and Coles (ASX:COL) could face a margin shock

Motley Fool contributor Nikhil Gangaram 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 owns shares of and has recommended Washington H. Soul Pattinson and Company Limited and Wesfarmers Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Bank of Queensland Limited (ASX: BOQ) shares are up 66% in the past 12 months. Shares in the Aussie regional bank have been surging and are outperforming the S&P/ASX 200 Index (ASX: XJO) and many of its peers.

So, what’s pushing BOQ’s valuation higher right now and how does it stack up against the Big Four?

Why Bank of Queensland shares are up 66% in the past 12 months

In general, the last 12 months have been good for ASX shares. The ASX 200 has climbed 23.7% higher over that period aided by significant monetary and fiscal policy stimulus.

Easing coronavirus restrictions in late 2020 have certainly helped. Shares in a broad range of industries including resources, technology and financials have all been on fire in the past year.

Bank of Queensland shares are chief among those outperformers. In fact, the Queensland-based bank has outperformed all of its Big Four rivals in the last year.

The Australia and New Zealand Banking Group Ltd (ASX: ANZ) share price is up 59.6% in the last 12 months. It’s a similar story for National Australia Bank Ltd. (ASX: NAB) and Westpac Banking Corp (ASX: WBC), up 53.5% and 49.5%, respectively.

Bank of Queensland shares are even beating Commonwealth Bank of Australia (ASX: CBA) shares over this period, with the CBA share price adding 61.3%.

It’s good news for shareholders who have come along for the ride. One of the biggest shake-ups in the last year was the bank’s $1.325 billion acquisition of Members Equity (ME) Bank.

Interestingly, one broker believes that Bank of Queensland shares have further to run. Analysts at JP Morgan currently rate the regional bank as ‘Overweight’ and see further growth from the recent acquisition.

Foolish takeaway

The past year has been a good one for Bank of Queensland shares and the bank’s investors. Shares in the regional bank have surged higher and are a strong outperformer amongst ASX bank shares.

The post Why Bank of Queensland (ASX:BOQ) shares are up 66% in the past 12 months appeared first on The Motley Fool Australia.

More reading

• The ASX 200 banks may be in danger as half of mortgage-stressed households have “borrowed to the hilt”
• Confirmed: APRA is planning action on home loans, ASX 200 banks drop
• These experts believe the future is bright for the Bank of Queensland (ASX:BOQ) share price
• How has the Bank of Queensland (ASX:BOQ) share price been performing since reporting results?
• Bank of Queensland (ASX:BOQ) share price in focus amid concerns over management churn rate

Motley Fool contributor Ken Hall 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.

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The Ethereum (CRYPTO: ETH) price is rebounding, up 1.7% over the past 24 hours. One Ether is trading for US$2,844 (AU$3,949).

Bitcoin (CRYPTO: BTC), still by far the world’s biggest crypto by market valuation, is back in the green as well. Bitcoin is up 1.3% since this time yesterday, trading for US$41,491.

That gives Bitcoin a market cap of US$781 billion.

At the current Ethereum price, its market cap stands at US$334 billion.

While that’s still less than half of Bitcoin’s total market value, crypto analysts are speculating that Ether may well overtake Bitcoin in the not too distant future.

The case for smart contracts

The Ethereum price has been a much stronger performer than Bitcoin over the past year.

Much of that, crypto analysts surmise, is due to the fact that the Ethereum network has valuable real life applications for business and finance. Many of which remain untapped.

Bitcoin, on the other hand, is limited to payment transactions. And, of course, you can hold onto it as well in hopes of making a profit.

Financial TikTok influencer Mason Versluis, aka “Crypto Mason”, doesn’t see much of a future for Bitcoin. But Versluis, who has some half a million followers on his account, is far more optimistic on other tokens with real life uses, like Ether.

According to Versluis (quoted by Business Insider):

It’s got to have use cases, meaning: does this token do nothing? Am I just buying this token because I think it’s going to go up in value? That is what I am personally invested in, just because of the potential – they actually do something. Ethereum has so many decentralised applications built on it.

The decentralised applications he’s talking about here make use of smart contracts so they can be self-executing.

So what’s a smart contract?

According to CoinDesk:

Smart contracts are code-based programs that are stored on the Ethereum blockchain and automatically carry out certain functions when predetermined conditions are met. This can be anything from sending a transaction when a certain event takes place, or loaning funds once collateral is deposited into a designated wallet.

With the digitisation of data racing ahead, the use cases described above could well be one reason investors have been driving the Ethereum price sharply higher.

Ethereum price snapshot

As an important reminder of the volatility involved with cryptos, the Ethereum price is still down 35% from its all-time high of US$4,379, reached on 12 May.

However, it has been a strong performer over the past full year, well outpacing Bitcoin.

The Ethereum price has gained 707% over the past 12 months, compared to a 288% gain for Bitcoin.

Year-to-date Ether has gained 291%, compared to a 43% gain for Bitcoin so far in 2021.

The post Why the Ethereum (CRYPTO:ETH) price is trouncing Bitcoin’s gains appeared first on The Motley Fool Australia.

More reading

• Why inflation angst is driving more Aussie investors to Bitcoin
• Will Ethereum overtake Bitcoin?
• China brings the hammer down on Bitcoin and all other crypto transactions
• AMP Capital’s chief economist on the future of Bitcoin and altcoins
• Not even Bitcoin and Dogecoin are immune to the Evergrande fallout

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Bitcoin and Ethereum. 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.

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The Firefinch Ltd (ASX: FFX) share price is flat on Thursday despite the company receiving government approval for a transaction regarding its Goulamina Lithium project.

At the time of writing, shares in the emerging lithium and gold producer are unchanged at 60 cents.

Firefinch share price falters despite project milestone

Firefinch announced that it received a letter of non-objection from the Malian Government for its joint venture transaction with China’s world leading lithium producer Ganfeng. 

Ganfeng is expected to become a 50% joint venture partner in the Goulamina Lithium Project and provide up to US$194 million in project funding in exchange for life of mine offtake. 

The release explained that the final condition precedent is the receipt of Chinese regulatory approvals which will allow the transfer of the Exploitation Licence from the Goulamina Lithium Project to the joint venture company. 

Once completed, Ganfeng will provide its first US$39 million cash investment for the Goulamina project. With another US$91 million to be received after the project’s final investment decision. 

The broader lithium sector opened slightly weaker on Thursday with Orocobre Limited (ASX: ORE) and Pilbara Minerals Ltd (ASX: PLS) down 0.71% and 0.76% respectively. This might be a factor weighing on the Firefinch share price despite today’s positive news.

Management commentary 

Firefinch managing director Dr Michael Anderson commented on the approval.

The support of the Malian Government and local community is key to the success of Goulamina and we are delighted to receive their formal support of our plans to develop this world class project.

Goulamina will be the next large scale global lithium hard rock project to enter production, and the first of its kind in West Africa, with production targeted for 2023.

Together with our partner, Ganfeng, the world’s largest lithium chemicals producer, we are working to expand the scale and production capacity of Goulamina and look forward to updating shareholders on the revised DFS in the coming weeks. 

What’s next for Firefinch? 

There’s plenty of catalysts for the Firefinch share price before the year end.

The company is working with Ganfeng to update its October 2020 definitive feasibility study (DFS) to enable a final investment decision (FID). 

Firefinch said that it anticipates the completion of an updated DFS and FID during the December quarter of 2021. 

The post Firefinch (ASX:FFX) share price struggles despite lithium project update appeared first on The Motley Fool Australia.

More reading

• Firefinch (ASX:FFX) share price tumbles 6% but remains 12% higher for the month
• ASX lithium shares are rallying across the board today. Here’s why.
• Firefinch (ASX:FFX) share price slides following tweet clarification
• Firefinch (ASX:FFX) share price leaps 16% on half-year results

Motley Fool contributor Kerry Sun 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.

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The Oil Search Ltd (ASX: OSH) share price is pushing upwards today following a positive update by the energy producer.

At the time of writing, Oil Search shares are up 0.7% trading at $4.34.

What did Oil Search announce?

In today’s statement, Oil Search advised it has reached a commercial agreement with its joint venture partners in the PNG LNG project. This is in relation to the redetermination of participating interests.

Currently, the PNG LNG project participants include ExxonMobil (33.2% interest), Oil Search (29% interest), Kumul Petroleum (PNG government) (16.8% interest), Santos (13.5% interest), JX Nippon (4.7% interest), and MRDC (PNG landowners, 2.8% interest).

Following its December 2020 initiation, the parties agreed that the current redetermination process would be discontinued and no adjustment made to the participating interests in the PNG LNG project. In addition, they agreed to cancel all future redeterminations provided for under the PNG LNG Coordinated Development and Operating
Agreement.

Oil Search said it would be entitled to a carried interest of US$176 million as part of the agreement. This will come from particular non-PNG state joint venture partners over the calendar years ending 2022 to 2024.

However, after 31 December 2024, the interest may be reduced or increased depending on the results of future drilling activities.

More on the PNG LNG Project

Since going online in 2014, the project has become a world-class liquefied natural gas development.

Operated by ExxonMobil, the PNG LNG project has consistently operated above its nameplate capacity of 6.9 million tonnes per annum (MTPA). In fact, in 2019, the project recorded its highest annual production of 8.5 MT, 23% above nameplate capacity.

The gas is conditioned in the PNG Highlands and then transported by a gas pipeline to the LNG plant located near Port Moresby. The gas is then liquefied at the LNG plant before being loaded onto tankers and shipped to Asian gas customers.

Approximately 7.9 MTPA of LNG from the project is currently sold under long and medium-term contracts. This represents more than 90% of LNG production from the project, reducing exposure to the weak LNG spot market.

About the Oil Search share price

Over the past 12 months, Oil Search shares have gained more than 60%, with year-to-date hovering close to 20%. 

Based on today’s price, Oil Search presides a market capitalisation of roughly $8.96 billion and has 2 billion shares outstanding.

The post Why the Oil Search (ASX:OSH) share price is edging higher appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Thursday
• Here are the 3 most traded ASX 200 shares so far today
• Here are the top 10 ASX shares today
• Here are the 3 most traded ASX 200 shares so far this Tuesday
• ASX 200 energy shares are surging, crude oil to hit US$90/b by year end: analyst

Motley Fool contributor Aaron Teboneras 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.

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The Whitehaven Coal Ltd (ASX: WHC) share price is having a great run on the ASX.

Shortly after open today, the Whitehaven share price is $3.26, which is 16.4% higher than it was 8 trading days ago.

The boost is even more impressive as it’s come about despite no price-sensitive news being released by the company.

Let’s take a look at what might be driving the coal miner’s share price higher.

Price of coal hits record highs

Whitehaven’s annual report was released to the market on Friday, 24 September.

Within it, the company’s directors noted global coal supplies are running short as demand from China is increasing.

In fact, that excess demand has seen the price of coal soaring recently.

According to data from Business Insider, a tonne of coal costs US$210 right now. That’s 40% more than this time last month. It’s also coal’s highest price ever.

The value of coal has been increasing due to demand from China outstripping supply. In fact, the nation is experiencing a shortage of the commodity.

China’s winter is approaching fast, and it needs electricity to heat households and keep its industries up and running.

In 2019, 57.7% of China’s electricity was created by burning coal.

According to reporting by Reuters, several Chinese provinces are currently rationing electricity in peak hours. Some manufacturers have had to slash their output due to the power shortage.

But markets can be cruel. The unfortunate news from China is good news for the Whitehaven share price.

As the ASX’s only pure-play coal producer, Whitehaven is seemingly reaping the rewards of record-high coal prices.

Whitehaven Coal share price snapshot

Recent gains to the Whitehaven share price have added to the stock’s strong performance on the ASX this year.

Right now, the company’s stock is trading for 96% more than it was at the start of the year. It has also gained 210% since this time last year.

The post The Whitehaven (ASX:WHC) share price is up 16% in 8 days. Here’s why. appeared first on The Motley Fool Australia.

More reading

• Which ASX shares are the top movers in the ASX 300 today?
• Here’s what’s driving support for ASX 200 energy shares
• Whitehaven Coal (ASX:WHC) share price on the rise after annual report release
• Which ASX 300 shares are the biggest winners and losers on Tuesday?
• Why the Whitehaven (ASX:WHC) share price is lifting on Tuesday

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.

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The NextDC Ltd (ASX: NXT) share price has been under pressure this week. Shares in the Aussie data centre operator have slumped 10.9% lower in the last 5 days to $12.12 per share.

That’s still in the middle of the company’s 52-week trading range, but investors might be wondering what’s driving NextDC’s valuation right now.

Why the NextDC share price is down 11% so far this week

Interestingly, there has been no price-sensitive news from the ASX tech group this week. That hasn’t stopped investors from selling down their exposures and pushing the NextDC share price lower.

It’s worth noting it hasn’t been a great week in general for tech shares. The Aussie markets have tended to follow Wall Street and the US markets lower following their performance overnight.

That’s certainly been the case in the past week or so. US tech shares have been smashed and we’ve seen a similar thing closer to home on the ASX.

The NextDC share price fell 2.7% lower on Wednesday as growth shares were hammered. Rising bond yields have spooked investors and there has been a pullback from those companies who have a lot of their value tied up in future earnings potential.

Rising bond yields mean higher discount rates. In laymen’s terms, a dollar earned today is worth more than a dollar earned tomorrow due to both risk and inflation.

Companies like NextDC don’t currently deliver significant earnings for shareholders. However, the future potential based on its current growth trajectory is what entices investors.

The NextDC share price slumped in late August despite a record FY21 performance. The data centre operator reported earnings before interest, taxes, depreciation, and amortisation (EBITDA) up 29% to $134.5 million. Group operating cash flow surged 148% to $133.2 million in a bumper year of growth.

However, high expectations combined with rising interest rate fears have put pressure on the company’s shares and seen them sink 10.9% lower in the past week.

The post Why is the NextDC (ASX:NXT) share price down 11% so far this week? appeared first on The Motley Fool Australia.

More reading

• ASX 200 tech correction? 5 of the worst-hit shares
• Why ASX tech shares are crashing on Wednesday
• Technology shares are dragging the ASX 200 down on Tuesday
• The NextDC (ASX:NXT) share price is down 3% on Monday
• 3 ASX tech shares to buy this week

Motley Fool contributor Ken Hall 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.

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The Zip Co Ltd (ASX: Z1P) share price is moving higher on Thursday. At the time of writing, shares are swapping hands for $7.34, up 5.45%.

This follows the buy now, pay later (BNPL) company announcing a new agreement with US-based tech giant Microsoft Corporation (NASDAQ: MSFT).

What’s sending the Zip share price higher today?

Investors are bidding up shares in the second-largest BNPL company on the ASX on Thursday. This is on the back of an announcement that appears to have caught the attention of the market.

According to the release, Zip has entered into an agreement with the second-largest listed company on the planet by market capitalisation – Microsoft.

This agreement involves the integration of Zip’s technology into the shopping experiences within Microsoft Edge. In turn, shoppers using the web browser will be able to use a digital payment option provided by Zip.

The integration into the company’s web browser will begin rolling out in the United States first.

Clearly, the market is chuffed with the news as the Zip share price pushes higher. As noted in the release, the integration unlocks access to more than 1.3 billion devices running Windows 10.

Management commentary

Commenting on the news, Zip co-CEO Brad Lindenberg stated:

Zip provides customers with a transparent, digital payment option, and we are excited to integrate with the shopping experience in Microsoft Edge. Microsoft Edge is a web browser that is built for shopping, and Zip is built for consumers looking for flexible payment options.

The expansion to Microsoft’s web browser follows news last week of Zip’s entrance into the BNPL market in India. To make this possible, Zip made a strategic investment in leading Indian BNPL operator ZestMoney.

Company snapshot

Despite the recent announcements, the Zip share price is down around 2% over the past 6 months. However, year-to-date the company’s shares have appreciated approximately 26% in value. As a result, Zip now holds a market capitalisation of $3.92 billion.

The post Zip (ASX:Z1P) share price jumps on Microsoft integration agreement appeared first on The Motley Fool Australia.

More reading

• Why the Zip share price plunged 6% this morning
• Afterpay (ASX:APT) and Zip (ASX:Z1P) share price falls as Mastercard opens up the BNPL sector
• Why ASX tech shares are crashing on Wednesday
• The S&P 500 just dropped 2%. Why is this impacting ASX 200 shares?
• 2 fantastic ASX tech shares to buy in October

Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Microsoft and ZIPCOLTD FPO. 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.

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The Flight Centre Travel Group Ltd (ASX: FLT) share price is on fire right now. Shares in the Aussie travel agency have soared 18% higher in the 8 trading days since Monday 20 September.

Flight Centre is up again today and trading at $21.25 shortly after open, which is 0.14% higher than yesterday’s close.

So, with Australia’s two most populous states still hampered by COVID-19 restrictions, how can this ASX travel share be charging higher?

How the Flight Centre share price has soared 18% higher in 8 days

One important factor to remember is that the share market is inherently forward-looking. The March bear market saw many ASX travel shares including Flight Centre get smashed even before earnings were directly affected.

The key, however, is that investors knew future earnings would be impacted. Shareholders are interested in future cash flows, which ultimately drives what a company’s intrinsic value is.

It may seem shocking that an ASX travel share can be outperforming while domestic and international borders remain shut. However, that’s exactly what we’re seeing with the Flight Centre share price right now.

There have been no updates from the Aussie travel group since 20 September, and even longer since any price-sensitive announcements. That hasn’t stopped investors from looking to the future and betting on Flight Centre’s success.

The important news in recent days has been around the reopening of the economy. New South Wales is gearing up to begin easing lockdown restrictions from what looks to be 11 October.

There is also a roadmap out of lockdown that includes talk of international border openings, while hopes remain for an easing of interstate restrictions by Christmas.

All of this is good news for the Flight Centre share price. Investors have been buying up big and pushing the ASX travel share up 18% in the past 8 days.

The post The Flight Centre (ASX:FLT) share price is up 18% in 8 days. How is this possible? appeared first on The Motley Fool Australia.

More reading

• Oil at a 3 year high and travel stocks soar. Scott Phillips on Nine’s Late News
• Here are the top 10 ASX shares today
• Why AVZ, Flight Centre, Fortescue, & Sigma shares are storming higher
• Which ASX 300 shares are leading the way on Monday?
• Why these ASX 200 travel shares are flying this Monday

Motley Fool contributor Ken Hall 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 Flight Centre Travel Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The BHP Group Ltd (ASX: BHP) share price is trading at a handy dividend yield right now. Shares in the iron ore mining giant boast an 11.1% yield as at Tuesday’s close.

Most double-digit yields would have income investors licking their lips, but is BHP good value based on its current numbers?

Does the BHP dividend yield make it good value?

Perhaps the best reference point is to compare the “big three” iron ore producers: BHP, Rio Tinto Limited (ASX: RIO) and Fortescue Metals Group Limited (ASX: FMG).

Shares in all three have struggled throughout 2021, and all three boasts solid dividend yields right now. The big question, however, is whether BHP shares look to be good value at current yields.

Sliding share prices and rising yields are certainly intertwined and one reason why the BHP dividend yield is so high. After all, a dividend yield is simply taking annualised actual or expected dividends and dividing them by the share price.

That means if a company announces a bumper dividend based on last year’s results, and then sees significant share price declines, its dividend yield will be through the roof.

Fortescue shareholders know this better than anyone. The Fortescue share price is down 40.3% in 2021 so far but boasts an impressive 24.2% dividend yield. That came after Fortescue doubled its dividend in its August full-year results after a strong performance in FY2020.

It also goes to show why buying ASX shares simply based on dividend yields can be risky business. A 24.2% yield looks great, but losing $10 in share price losses to gain a $3.58 per share full-year dividend doesn’t seem ideal.

So, BHP’s dividend yield is lower than Fortescue. However, the BHP share price has also lost 15.5% compared to Fortescue’s steep decline. What about Rio Tinto?

Rio shares are down 16.0% in 2021 and trading at a 9.4% dividend yield prior to Wednesday’s open. That means Rio’s share price has fallen more and its yield still remains marginally below BHP’s.

Is the ASX resources share good value?

In terms of value, one broker certainly sees it that way. Analysts from Macquarie Group Ltd (ASX: MQG) currently rate BHP with a ‘buy’ rating and a price target of $56 per share.

Given the current $36.39 price level, that implies significant upside to the Aussie mining share. However, Macquarie things commodities outside of iron ore, such as coal, oil, copper and nickel, as key to its current outlook.

Foolish takeaway

The BHP dividend yield is very healthy right now. However, investors need to consider more than just the yield on offer when deciding whether to buy.

Looking purely at the above numbers, BHP shares appear to be trading at a similar relative position to Rio Tinto. Fortescue seems to be more of an outlier with steeper share price declines and a doubling of its dividend compounding its current yield figures.

The big three iron ore miners have seen steep share price declines in 2021 and all are trading at low dividend yields and price to earnings (P/E) ratios right now.

Investors need to do their research beyond just simple statistics to determine whether or not BHP’s dividend yield makes it good value at the moment.

The post Does the 11% BHP (ASX:BHP) dividend yield make it good value? appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Thursday
• The S&P 500 just dropped 2%. Why is this impacting ASX 200 shares?
• How China’s energy crisis could be good for BHP (ASX:BHP) and Rio Tinto (ASX:RIO)
• 2 beaten-up ASX shares that could be buys in October 2021
• BHP (ASX:BHP) shareholders urged to reject climate action plan

Motley Fool contributor Ken Hall 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.

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