This report is not a personal recommendation and does not take into account your personal circumstances or appetite for risk.
Trade Parameters
Technical Observations – For
Technical Observations – Against
Bullish breakout by shares from narrowing pattern after announcement of special dividend to maintain share price support after end of share buyback. Easing in US/China trade war fears helping sentiment that could avoid more tariffs and/or a trade war. Any oil price rebound would help. Very attractive 8.7% forward dividend yield.
Risks to BHP Billiton include a global trade war, an emerging markets crisis or anything that puts Chinese economic growth (and thus consumption of raw materials) at risk. A stronger USD makes dollar-denominated commodities more expensive to non-USD buyers. More equity market weakness could see risk assets like Miners shunned. Lastly, Broker downgrades.
Brokers are positively biased toward the Miner, with close to 90% of analysts saying “Buy” or “Hold” and only 3 saying “Sell”. Bullish attitude further reinforced by two-thirds of brokers seeing upside, to a consensus target of 1735p.
Next Event: H2 Operations Review, 22 Jan
Latest Broker 12-Month Consensus: 28% Buy, 62% Hold, 10% Sell (full breakdown on request)
Source: DowJones Newswires, Reuters News, Bloomberg or Company Press releases
| 1wk | 1m | 3m | 6m | 1yr | 2yr | 3yr | 4yr | 5yr | |
| Perf % | 8.5 | 7.8 | 8.8 | -4.8 | 20.0 | 22.9 | 148.8 | 25.7 | -5.2 |
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Prepared by Michael van Dulken, Head of Research