BHP GROUP LTD-SPON ADR (BHP) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:BHP - US0886061086 - ADR
67.52 USD
+2.55 (+3.92%)
67.56 USD
+0.04 (+0.06%)
We assign a fundamental rating of 5 out of 10 to BHP. BHP was compared to 156 industry peers in the Metals & Mining industry. While BHP has a great profitability rating, there are some minor concerns on its financial health. BHP has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
- In the past year BHP was profitable.
- BHP had a positive operating cash flow in the past year.
- BHP had positive earnings in each of the past 5 years.
- In the past 5 years BHP always reported a positive cash flow from operatings.
1.2 Ratios
- Looking at the Return On Assets, with a value of 8.29%, BHP belongs to the top of the industry, outperforming 83.97% of the companies in the same industry.
- BHP has a better Return On Equity (18.92%) than 92.31% of its industry peers.
- BHP's Return On Invested Capital of 12.49% is amongst the best of the industry. BHP outperforms 85.26% of its industry peers.
- BHP had an Average Return On Invested Capital over the past 3 years of 14.98%. This is above the industry average of 10.34%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.29% | ||
| ROE | 18.92% | ||
| ROIC | 12.49% |
ROA(3y)9.59%
ROA(5y)14.32%
ROE(3y)21.86%
ROE(5y)31.27%
ROIC(3y)14.98%
ROIC(5y)17.95%
1.3 Margins
- The Profit Margin of BHP (17.59%) is better than 81.41% of its industry peers.
- In the last couple of years the Profit Margin of BHP has declined.
- Looking at the Operating Margin, with a value of 37.67%, BHP belongs to the top of the industry, outperforming 88.46% of the companies in the same industry.
- BHP's Operating Margin has been stable in the last couple of years.
- BHP's Gross Margin of 56.70% is amongst the best of the industry. BHP outperforms 89.74% of its industry peers.
- BHP's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 37.67% | ||
| PM (TTM) | 17.59% | ||
| GM | 56.7% |
OM growth 3Y-9.43%
OM growth 5Y1.25%
PM growth 3Y-28.17%
PM growth 5Y-2.95%
GM growth 3Y-5.52%
GM growth 5Y-0.81%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), BHP is creating some value.
- BHP has about the same amout of shares outstanding than it did 1 year ago.
- Compared to 5 years ago, BHP has more shares outstanding
- The debt/assets ratio for BHP is higher compared to a year ago.
2.2 Solvency
- An Altman-Z score of 3.30 indicates that BHP is not in any danger for bankruptcy at the moment.
- BHP has a Altman-Z score (3.30) which is comparable to the rest of the industry.
- BHP has a debt to FCF ratio of 2.75. This is a good value and a sign of high solvency as BHP would need 2.75 years to pay back of all of its debts.
- BHP has a better Debt to FCF ratio (2.75) than 74.36% of its industry peers.
- A Debt/Equity ratio of 0.47 indicates that BHP is not too dependend on debt financing.
- BHP's Debt to Equity ratio of 0.47 is on the low side compared to the rest of the industry. BHP is outperformed by 73.72% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.47 | ||
| Debt/FCF | 2.75 | ||
| Altman-Z | 3.3 |
ROIC/WACC1.18
WACC10.55%
2.3 Liquidity
- BHP has a Current Ratio of 1.46. This is a normal value and indicates that BHP is financially healthy and should not expect problems in meeting its short term obligations.
- BHP has a Current ratio of 1.46. This is in the lower half of the industry: BHP underperforms 72.44% of its industry peers.
- A Quick Ratio of 1.11 indicates that BHP should not have too much problems paying its short term obligations.
- BHP has a worse Quick ratio (1.11) than 63.46% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.46 | ||
| Quick Ratio | 1.11 |
3. Growth
3.1 Past
- BHP shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -25.60%.
- BHP shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 2.30% yearly.
- Looking at the last year, BHP shows a decrease in Revenue. The Revenue has decreased by -7.90% in the last year.
- BHP shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 5.66% yearly.
EPS 1Y (TTM)-25.6%
EPS 3Y-21.91%
EPS 5Y2.3%
EPS Q2Q%-28.42%
Revenue 1Y (TTM)-7.9%
Revenue growth 3Y-7.66%
Revenue growth 5Y5.66%
Sales Q2Q%-8.23%
3.2 Future
- The Earnings Per Share is expected to decrease by -1.69% on average over the next years.
- Based on estimates for the next years, BHP will show a small growth in Revenue. The Revenue will grow by 0.08% on average per year.
EPS Next Y10.48%
EPS Next 2Y1.23%
EPS Next 3Y1.77%
EPS Next 5Y-1.69%
Revenue Next Year0.84%
Revenue Next 2Y-0.92%
Revenue Next 3Y-0.07%
Revenue Next 5Y0.08%
3.3 Evolution
- The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
- The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- The Price/Earnings ratio is 16.84, which indicates a correct valuation of BHP.
- BHP's Price/Earnings ratio is rather cheap when compared to the industry. BHP is cheaper than 93.59% of the companies in the same industry.
- BHP is valuated rather cheaply when we compare the Price/Earnings ratio to 27.21, which is the current average of the S&P500 Index.
- With a Price/Forward Earnings ratio of 15.25, BHP is valued correctly.
- Based on the Price/Forward Earnings ratio, BHP is valued a bit cheaper than 75.00% of the companies in the same industry.
- BHP is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 24.26, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.84 | ||
| Fwd PE | 15.25 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, BHP is valued cheaply inside the industry as 92.31% of the companies are valued more expensively.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of BHP indicates a rather cheap valuation: BHP is cheaper than 92.95% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.27 | ||
| EV/EBITDA | 7.1 |
4.3 Compensation for Growth
- The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
- BHP has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)1.61
PEG (5Y)7.33
EPS Next 2Y1.23%
EPS Next 3Y1.77%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 3.46%, BHP has a reasonable but not impressive dividend return.
- BHP's Dividend Yield is rather good when compared to the industry average which is at 0.96. BHP pays more dividend than 94.87% of the companies in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.82, BHP pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.46% |
5.2 History
- The dividend of BHP decreases each year by -1.48%.
- BHP has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)-1.48%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
- BHP pays out 70.99% of its income as dividend. This is not a sustainable payout ratio.
- The Dividend Rate of BHP has been decling, while earnings will also be declining. This means the current dividend is most likely not sustainable.
DP70.99%
EPS Next 2Y1.23%
EPS Next 3Y1.77%
BHP GROUP LTD-SPON ADR / BHP FAQ
What is the ChartMill fundamental rating of BHP GROUP LTD-SPON ADR (BHP) stock?
ChartMill assigns a fundamental rating of 5 / 10 to BHP.
Can you provide the valuation status for BHP GROUP LTD-SPON ADR?
ChartMill assigns a valuation rating of 6 / 10 to BHP GROUP LTD-SPON ADR (BHP). This can be considered as Fairly Valued.
How profitable is BHP GROUP LTD-SPON ADR (BHP) stock?
BHP GROUP LTD-SPON ADR (BHP) has a profitability rating of 8 / 10.
What are the PE and PB ratios of BHP GROUP LTD-SPON ADR (BHP) stock?
The Price/Earnings (PE) ratio for BHP GROUP LTD-SPON ADR (BHP) is 16.84 and the Price/Book (PB) ratio is 3.6.
What is the earnings growth outlook for BHP GROUP LTD-SPON ADR?
The Earnings per Share (EPS) of BHP GROUP LTD-SPON ADR (BHP) is expected to grow by 10.48% in the next year.