The BHP (ASX:BHP) share price keeps falling, could it be an opportunity?

The share price of BHP Group Ltd (ASX:BHP) is down again today. Could the resources giant be a leading opportunity right now?
The post The BHP (ASX:BHP) share price keeps falling, could it be an opportunity? appeared first on The Motley Fool Australia. –

Over the last couple of weeks the BHP Group Ltd (ASX: BHP) share price has been falling and it has continued that downward trend further today. The resources stock is down 2% at the time of writing.

Since 10 May 2021, BHP shares have fallen by almost 10%. Considering the ASX market capitalisation of BHP is currently approximately $140 billion, a 10% drop is a hefty drop in dollar terms.

What is the latest news?

In the shorter-term, investors pay attention to BHP’s quarterly production numbers and the changing commodity prices.

Iron ore is the biggest profit generator right now. Whilst the iron ore price is a bit lower than the last week or two, it’s still above US$200 per metric tonne which is almost the highest it has been over the last five years.

A few weeks ago the business revealed how it performed in the performed in the three-month period to 31 March 2021.

Petroleum production was up 7% to 25.4 million barrels of oil equivalent (MMboe). Higher volumes reflect the increased Shenzi working interest (after completion in November 2020) and the impacts of Hurricanes Delta and Zeta in the Gulf of Mexico in the prior quarter.

Copper production was down 9%. Lower volumes were primarily a result of decreased throughput at Escondida, reflecting the impact of a reduced operational workforce due to the continuation of COVID-19 restrictions and lower concentrator feed grade.

Iron ore production was down 4% to 59.9 Mt. Lower volumes at Western Australia iron ore (WAIO) reflects weather impacts and planned ore handling plant and stacker maintenance at Newman, partially offset by improved car dumper performance.

Metallurgical coal saw production rise 1%. Queensland coal volumes were in line with the prior quarter as operations continue to be impacted by wet weather events.

Energy coal saw a large 34% increase in production thanks to higher volumes at Cerrejon as a result of a strike in the prior period, partially offset by lower volumes at New South Wales energy coal (NSWEC) with significant wet weather impacts and increased washed coal in response to reduced port capacity following damage to a shiploader at the Newcastle port.

Nickel saw production volumes fall 15% as a result of planned maintenance undertaken at the Kwinana refinery.

Is the lower BHP share price an opportunity?

BHP itself is looking to growth opportunities to help continue the strong performance it is experiencing.

The CEO of BHP, Mike Henry, said:

We are reliably executing our major projects, bringing on new supply in copper, petroleum and iron ore. The Spence Growth Option and Samarco are ramping up and West Barracouta, in petroleum, started production this morning. First production from petroleum’s ruby project is expected in the coming weeks and South Flank, with its higher grade and lump proportion, is on track to begin production in the middle of the year.

The brokers at Macquarie Group Ltd (ASX: MQG) are still confident about BHP shares. It noted that BHP said last week that the ASX miner will soon announce first production at the 80 million per annum South Flank iron ore project. Macquarie is expecting very strong profit in the FY21 second half. The broker has a price target on the BHP share price of $57 over the next 12 months. That suggests a possible upside of around 20%.

Where to invest $1,000 right now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

*Returns as of February 15th 2021

More reading

ASX 200 up 0.1%: Aristocrat results, Zip’s global expansion continues

AGL (ASX:AGL) may need a ~$600m capital raise to complete demerger
ASX 200 Weekly Wrap: ASX whipsaws in volatile week

5 things to watch on the ASX 200 on Monday

Top brokers name 3 ASX shares to buy next week

The post The BHP (ASX:BHP) share price keeps falling, could it be an opportunity? appeared first on The Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!