BHP Share Price Drops in 2024

The BHP Group Ltd, a major player on the ASX, has seen its share price tumble by 19.4% since the start of 2024. This raises an important question for investors: is it time to reconsider BHP’s value in the market?

While BHP’s stocks have been on the decline, another company, CSL Ltd, is experiencing a different trend. CSL shares are currently just 6% away from their 52-week high, making it a potential contender for investors’ watchlists alongside BHP.

BHP Group, which has been around since 1885, is known for its broad range of natural resources, focusing on commodities that are crucial for energy and manufacturing. They also have their sights set on expanding into fertilizers. The company’s operations cover mineral exploration and production, focusing on three main areas: copper and related minerals, iron ore, and coal.

Investors often see BHP as a reliable choice due to its consistent dividend payments. If you’re part of an ETF or a superannuation fund, you likely have some exposure to BHP already.

As a blue-chip stock, BHP is considered a mature business, and it’s essential for investors to look at metrics like return on invested capital (ROIC) and revenue growth to gauge sustainability. Last fiscal year, BHP achieved an impressive ROIC of 28.10%, with revenue growth compounding at 22.7% in recent years, well above the industry average.

On the other hand, CSL is a well-established biotechnology company known for its innovative medicines and reliable dividend payouts. The company is split into three main divisions: CSL Behring, CSL Seqirus, and CSL Vifor, each specializing in different healthcare products.

Right now, BHP shares are offering a dividend yield of around 6.26%, which is slightly above its five-year average of 6.14%. Conversely, CSL’s shares present a lower yield at about 1.20%, compared to its five-year average of 1.28%. Understanding these figures offers insight into the current investment landscape.