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BHP - BHP Group

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vishalt said:
It's return in the US (in the form of ADR's) is 54%, compared with the Aussie stock which has returned 35%, am I missing something?
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Yes you have.

The USD has tanked against the AUD. If you converted aussie dollars to yankee dollars to buy the ADRs and then back to aussie dollars today, you will find that your return (in AUD) will be 35%.
 

Seems so long ago, but it was just in January that I was thinking that BHP was in deep trouble....

My, how 6 months can change things!!!! BHP has now risen 14.80 since bottoming out at 24 and we have a 60% return for those investors that went long at this point..... For such a large Company, this is an incredible result....

My question is where does the wave 5 stop - even Nick was saying be cautious at about 32.50 and now we are way way way off that number..... I laughed when I saw reports of BHP being able to get to 40.00 shortly, but what do you know, we are nearly there.....

Cheers
 
It is no longer free money - but BHP still has high quality, long life assets exposed to Chinese demand and massive cashflow generation.

It still trades at a huge discount to the overvalued ASX industrials ex Banks and will soon be debt free.

$38 will look cheap if commodities prices remain where they are for another year or so. They don't even have to go up.

Anyone keen to predict oil, copper, iron ore and coking coal to fall in the coming year? Global GDP is expanding and the drivers are developing countries whose growth is 'metals rich'.

Even the US has some good manufacturing and industrial production figures emerging. It appears the US property collapse is a big "who cares" for the metals complex.

For the fourth year running, the analysts are using massive falls for one/two year forward commodities prices in their models and in my view, again they will be wrong and having to upgrade on the run.

Why should copper fall below $3 if we are in deficit for another year and inventories are approaching the sub 100,000 tn mark?

Why do these analysts maintain price assumptions so different from forward markets?

Anyone keen to name 5 greenfield copper projects of substance (100,000tn pa) coming online in the next 18 months?

I can think of 2.

The 'new supply wave' for copper is years away...

The iron ore hopefuls are still 3+ years away and their cost curves are multiple of the DSO producers.

Anyone found a new oil elephant yet?

What about coking coal? Anyone know a new supplier coming on line?
 

True although PE is getting high now, 13 atm

Earnings and Dividends Forecast (cents per share)
2006 2007 2008 2009
EPS 225.4 272.6 312.3 331.0
DPS 48.4 50.9 53.6 62.0

EPS(c) PE Growth
Year Ending 30-06-07 272.6 13.8 21.0%
Year Ending 30-06-08 312.3 12.0 14.6%

Thanks

MS
 
BHP set to test $40 SP today, days high $39.79

A landmark occasion for the Big Australian, maybe will consolidate over $40 and go for another run mid August depending on the market movement in general.
 
Where's Ducati?

Ducati,

Are you going to revise your valuation, or is this just hedge fund speculative buying, or future fund buying?

Or, were your assumptions incorrect?

Or, will we still see $15 BHP shortly?

Sincerely interested in your current position. Cheers.
 
post script
Joe's view is that a PM from me to ducati might be in order on this matter.
True.
But Kennas is also interested in what ducati might have to add here.
And maybe others too.
BHP is a market megalith.
When people like ducati, who self-confesses to being well qualified in analysis, make gross mistakes (not itty bitty little ones) on such an equity, it makes "rampers" look good.
ducati does not have to answer to us.
He should, however, be answering to himself.
How did he get it so wrong?

The reality is that posting a point of view begs a hiding to nothing.
Sometimes we win.
Sometimes we lose.
We should not, however, delude ourselves that we must be right because the "numbers line up", or whatever!

ducati will again remind me that gold is not yet $800.
But in this game patience is a virtue and man waits for all time.
 

No, my *valuation* was for the intrinsic value for BHP. While the intrinsic valuation may be slightly higher on an updated analysis, it will not be significantly so.

BHP is overvalued and will remain so while;
*Equity markets worldwide reflect Bull market valuations
*Sentiment predominates valuations

BHP [apparently] pays it's lorry drivers $120K/year. If [when] commodity prices fall the COG component will impact margins significantly, unless they are made redundant. This is just one example out of any number of problems that face BHP.

BHP is a *price taker* not a price maker, and will always reflect the underlying prices for commodities. Thus, when commodity prices are strong, the share price will reflect the enthusiasm for the rising earnings. When commodity prices fall, so falls the share price.

Cyclicals [BHP] are bought at the bottom of the cycle [intrinsic value levels] and sold at overvaluations, such as current valuations.

Additionally, you will have the trader fraternity who will follow and strengthen the trend both to the upside and the downside.

Currently the *story* is China's boom and the commodity supercycle, which personally I see as total nonsense, but, we'll see.

jog on
d998
 
ducati
You are to be commended on your consistency.
Oddly enough in a bull market most stocks rise to inflated levels.
The converse is also true.
This does not help one trade an equity, except to understand the nature of a trend.
"Price taker" and "price maker" mumbo jumbo is not helpful as institutions forward price "value" on their consensus estimates. In this environment, the institutions have marked down forward prices for commodities for years.
They, like you, keep getting it wrong and the price of BHP steams ahead on the power of a non existent commodity supercycle.

Yet again your post is a total sham, with market truisms that impact the likes of BHP as they do stock in many other sectors.
What makes it dangerous is the implication that BHP is always bought at the bottom of the cycle, and sold at the top. This is not supported by the data, or any data for that matter. Because within a cycle there is constant trading, and the top and bottoms are only known well after the event.

I won't say that BHP is a screaming buy. It was when it was around $25 and I posted my thoughts at the time, and bought BHP to boot.
BHP has proven time and again that a major diversified industrial equity has the capacity to outlast sectoral fads, such as drive single commodity stocks like PDN, or SMY. Most importantly, in my view, BHP has long term exposure to high value "energy" resources that will sustain its high prices much longer than folk like ducati could conceive.
 
rederob

That you agree that in a Bull market, common stocks rise to inflated levels would rather indicate that after 8 years + of a commodity bull market it then is reasonable to assert that BHP is overvalued.

In a bear market, they fall to unjustifiable [low] levels. Common stocks at undervaluations can be recognized and capitalized upon.

It is the overexuberance in valuations that are more difficult to *time* as the bullish sentiment may remain long past any rational, sane or even optimistic valuation.

As to BHP having the capacity to outlast sectoral fads, nonsense, simply look at BHP's chart, it suffered the neglect of the sector the same as any one trick pony.

jog on
d998
 
ducati needs to come to grips with what the market is about, namely, making money.
I won't deal with his other points as this thread is more about working out if BHP is a buy or a sell. ducatis comments in this regard are quite useless unless you give them credence. His track record here is as good as krisbarry's ramps.
 
I feel that BHP has hit a support at $35.53. Candlesticks show "springs"and hammer pattern formation. Bullish signs. Overall, I think it has passed its wave 5 and is at the end of corrective wave (a).

In addition, the ultra high volume on 27th July occurred when there was a tiny price range confirms that smart money is moving in.

What do others thinks?
 
BHP - so important to aussie market

BHP is vitally important to the strength of the aussie market.

If BHP falls like the rest of the ASX the all ords will be low 5000's

A BHP at $24 again would be a serious correction.


Thoughts?

The financial have been in a down trend for some time now.
 
BHP will not fall to $24. Chinese new formed nation investment fund are buying or going to buy BHP as strategic investment for China's huge export surplus. That is the opportunity for them to buy a decent amount without causing significant price effect.
 
BHP was $24.12 when I bought a swag on Jan 8 this year. I would LOVE to see them at that level again...

LOAD UP LOAD UP

Too bad I am dreaming. I can't see BHP going below $30 again, EVER.

My opinion only DYOR.
 

And we can add old rederob

BHP speculative?
Or fundamental?

Guess what chaps, the price being reflected at these and higher levels are speculative. Hence, the wide fluctuations.
 

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ducati916 said:
And we can add old rederob

BHP speculative?
Or fundamental?

Guess what chaps, the price being reflected at these and higher levels are speculative. Hence, the wide fluctuations.
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It's still double your valuation isn't it Ducati? I sold out at $36.50 ish. Made 200% on my investment.

I'm happy investing in growth and earnings, and trading off price action.

I think there will be more opportunites in BHP.

Unhappy I didn't short it a few days ago!
 
BHP down currently in the US 8.15%

The point that I made is that the price of BHP is currently a speculative price, which means to make money in this name, you have to actively TRADE the stock.

Purchasing for an investment, that is to hold over a longer time period is fraught with problems due to the huge speculative pricing.

This is what was being advocated by many.

If you want simply to trade it, fine, no valuation required.

jog on
d998
 
ducati916 said:
If you want simply to trade it, fine, no valuation required.

jog on
d998
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Yep, I get your point.

I am really struggling to truly value anything. The amount of misinformation, deception, and assumption made by all is overwhelming. Company accountants do a post grad at Hogwarts, I'm sure!

I'm starting to lean towards managed funds for 'value' and trade price action. That's certainly the way I've gone over the past 2 years. I used to hold a pile of blue chips. Now, I have some left over Telstra that Rach got given to her when she was employed there. They'll be in the bin shortly too.
 
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