BHP announced the return of the full US$10.4 billion proceeds from the sale of the mining giant’s US shale assets.
The funds will be returned to shareholders almost immediately through a combination of an off-market buyback in Nov/Dec 18 (US$5.2 billion) and a special dividend of US$5.2 billion payable in January 2019.
BHP has been under an ALGO buy signal since September 11th at $31.20 and we see the next chart resistance level at $35.40.
BHP
Based on the positive production numbers from their quarterly update earlier this month, we believe BHP offers value within $29 – $31 price range.
The stock is currently under an ALGO buy signal from $30.70 on September 11th. The recent price action reflects a potential “double bottom” pattern near $30.50.
BHP goes Ex-dividend for $0.70 on the 8th March.
BHP is under Algo Engine buy conditions from $31.20.
Shares of the mining giant have dropped over 12% during the last three weeks and have reached a value area.
Over the next few weeks, we expect the company to make an announcement about the completion of their shale divestment and its plans for the cash.
It’s widely believed that BHP will announce a special dividend and a share buyback program.
Our Algo Engine generated a buy signal in BHP following the recent “higher low” chart formation.
We see value in the $30 – $31 range and suggest accumulating BHP with a view towards selling covered call options to enhance the overall investment return.–
BHP
Our Algo Engine generated a buy signal in BHP and we highlight in the chart below our preferred accumulation price range.
Escalating trade tariffs and concerns regarding a China slowdown are the obvious reasons for short-term price weakness in BHP’s share price.
We expect to see some sort of resolution in the trade disputes by the New Year, although pressure will likely remain ahead of the US mid-term elections in November.
BHP
In a move to diversify its asset base, mining giant BHP has agreed to pay around $50 million for a 6.1% stake in SolGold, which operates a copper-gold project in the mineral-rich Cascacbel region of Ecuador.
Interestingly, one of BHP’s partners in the SolGold project will be Newcrest mining, which owns 14.5% of the mine and is the majority operator.
We take notice of the foresight of this purchase, along with other asset acquisitions by domestic mining names against the backdrop of falling raw materials and mineral prices.
We see solid chart support for BHP in the $30.60 area.
BHP
Shares of BHP have found support just above $32.00 after Wednesday’s mixed full year profit report.
While total revenue rose 20% to US43 billion, cost will likely rise as the company lowered its productivity savings target for 2019.
Still, we believe stable Iron Ore prices and strong energy supports BHP. Capital returns to underpin downside risks.In BHP.
BHP goes ex-dividend for 85.6 cents on September 6th.
BHP
Shares of BHP have traded with a slight downward bias since announcing over $10 billion in asset sales last week.
Some of the investor uncertainty focuses on what the mining giant will do with the proceeds of the sales.
The company has signalled its intention to return all net proceeds to shareholders but has not outlined the timing or manner in which this will happen.
Technically, we see solid price support in the $32.50 area.
Factoring in the expanded share buyback scheme, an increased dividend and a special dividend could lift the share price back into the $37.00 area.
BHP
Shares of BHP have jumped over 2% to $34.50 in early trade following the announcement of the sale of their onshore shale assets in the USA.
British Oil giant BP will pay USD 10.5 billion for the bulk of the energy assets, while Texas-based Merit Energy will buy the other $300 million worth of assets.
The company has pledged that the USD 10.8 billion from the sales will be returned to shareholders, but hasn’t been clear about how and when.
BHP has rallied from the April “higher low” formation and is now trading at the upper range of our price target.
Our advice to blog readers in April was to buy BHP and se ll the $35.00 strike call options to enhance the cash flow.
BHP
Our ALGO engine triggered a buy signal for BHP on March 9th at $28.32.
A recent broker note focused on the mining giant’s increased production of Iron Ore, Coal and Crude Oil as the basis for upgrading their 12-month price target to $37.00.
As mentioned in a previous Blog, we believe these upgrades will also lead to an increase of their dividend to the $1.40 range.
With a potential “double top” resistance in the $35.50 area, we would consider a buy/write strategy at these levels.
BHP goes ex-dividend for 60 cents on September 7th.
BHP
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