BHP GROUP LTD-SPON ADR (BHP) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:BHP - US0886061086 - ADR
67.77 USD
+0.25 (+0.37%)
68.8 USD
+1.03 (+1.52%)
We assign a fundamental rating of 5 out of 10 to BHP. BHP was compared to 154 industry peers in the Metals & Mining industry. BHP scores excellent on profitability, but there are some minor concerns on its financial health. BHP is valued quite cheap, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
- BHP had positive earnings in the past year.
- In the past year BHP had a positive cash flow from operations.
- Each year in the past 5 years BHP has been profitable.
- Each year in the past 5 years BHP had a positive operating cash flow.
1.2 Ratios
- The Return On Assets of BHP (8.29%) is better than 83.77% of its industry peers.
- The Return On Equity of BHP (18.92%) is better than 91.56% of its industry peers.
- Looking at the Return On Invested Capital, with a value of 12.49%, BHP belongs to the top of the industry, outperforming 85.06% of the companies in the same industry.
- Measured over the past 3 years, the Average Return On Invested Capital for BHP is above the industry average of 10.32%.
| 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
- BHP's Profit Margin of 17.59% is amongst the best of the industry. BHP outperforms 81.17% 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 88.31% of the companies in the same industry.
- In the last couple of years the Operating Margin of BHP has remained more or less at the same level.
- BHP has a better Gross Margin (56.70%) than 89.61% of its industry peers.
- In the last couple of years the Gross Margin of BHP has remained more or less at the same level.
| 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
- The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so BHP is still creating some value.
- Compared to 1 year ago, BHP has about the same amount of shares outstanding.
- The number of shares outstanding for BHP has been increased compared to 5 years ago.
- Compared to 1 year ago, BHP has a worse debt to assets ratio.
2.2 Solvency
- BHP has an Altman-Z score of 3.37. This indicates that BHP is financially healthy and has little risk of bankruptcy at the moment.
- BHP's Altman-Z score of 3.37 is in line compared to the rest of the industry. BHP outperforms 44.81% of its industry peers.
- 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.
- The Debt to FCF ratio of BHP (2.75) is better than 75.32% of its industry peers.
- BHP has a Debt/Equity ratio of 0.47. This is a healthy value indicating a solid balance between debt and equity.
- With a Debt to Equity ratio value of 0.47, BHP is not doing good in the industry: 74.03% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.47 | ||
| Debt/FCF | 2.75 | ||
| Altman-Z | 3.37 |
ROIC/WACC1.17
WACC10.71%
2.3 Liquidity
- A Current Ratio of 1.46 indicates that BHP should not have too much problems paying its short term obligations.
- BHP has a worse Current ratio (1.46) than 72.08% 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 Quick ratio of 1.11. This is in the lower half of the industry: BHP underperforms 62.99% 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.
- The Revenue has decreased by -7.90% in the past year.
- The Revenue has been growing slightly by 5.66% on average over the past years.
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
- BHP is expected to show a decrease in Earnings Per Share. In the coming years, the EPS will decrease by -1.69% yearly.
- The Revenue is expected to grow by 0.08% on average over the next years.
EPS Next Y16.85%
EPS Next 2Y5.34%
EPS Next 3Y3.79%
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.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 16.90, BHP is valued correctly.
- Based on the Price/Earnings ratio, BHP is valued cheaper than 92.21% of the companies in the same industry.
- Compared to an average S&P500 Price/Earnings ratio of 27.25, BHP is valued a bit cheaper.
- Based on the Price/Forward Earnings ratio of 14.47, the valuation of BHP can be described as correct.
- 75.32% of the companies in the same industry are more expensive than BHP, based on the Price/Forward Earnings ratio.
- When comparing the Price/Forward Earnings ratio of BHP to the average of the S&P500 Index (25.98), we can say BHP is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.9 | ||
| Fwd PE | 14.47 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, BHP is valued cheaply inside the industry as 91.56% of the companies are valued more expensively.
- BHP's Price/Free Cash Flow ratio is rather cheap when compared to the industry. BHP is cheaper than 92.86% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.34 | ||
| EV/EBITDA | 7.36 |
4.3 Compensation for Growth
- The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
- The excellent profitability rating of BHP may justify a higher PE ratio.
PEG (NY)1
PEG (5Y)7.35
EPS Next 2Y5.34%
EPS Next 3Y3.79%
5. Dividend
5.1 Amount
- BHP has a Yearly Dividend Yield of 3.56%.
- BHP's Dividend Yield is rather good when compared to the industry average which is at 1.02. BHP pays more dividend than 94.81% of the companies in the same industry.
- BHP's Dividend Yield is rather good when compared to the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.56% |
5.2 History
- The dividend of BHP decreases each year by -1.48%.
- BHP has paid a dividend for at least 10 years, which is 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.
- BHP's earnings and Dividend Rate are declining. This means the current dividend is most likely not sustainable.
DP70.99%
EPS Next 2Y5.34%
EPS Next 3Y3.79%
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 7 / 10 to BHP GROUP LTD-SPON ADR (BHP). This can be considered as Undervalued.
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 16.9 and the Price/Book (PB) ratio is 3.61.
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 16.85% in the next year.