BHPIn this article we look at BHP, an investment held in practically all our clients’ portfolios. We recently asked Michael Steengaard of Macquarie Equities Ltd for his views based on the research his organisation does on BHP. (This information was published in January 2012. Check in with us to get a current update.)

Q. What are BHP’s main income earning activities?
A. BHP’s main business comprise Iron Ore (45% of earnings), Petroleum (21%) and Copper (14%)
Q. How have these main businesses of BHP been travelling this year?
A. All are up for the quarter and comfortably meeting expectations. The company has just released their latest figures and report a solid set of December quarter production results with the following highlights:
• Iron Ore in the Pilbara, WA set another production and sales record
• US oil and gas volumes met upwardly revised numbers
• Copper volumes benefitted from the lack of strike action of the previous quarter at the Escondida mine in Chile and completed maintenance outages at Pampa Norte in Chile and Olympic Dam in South Australia.
Q. Given the big gyrations in share markets around the world and disruptions in Europe what is your view of BHP as a long term holding in our clients’ portfolios?
A. We believe the structural Chinese growth dynamic remains a powerful driver of, and partial insulating factor for, sustained commodity prices over the next few years which augers well for BHP. Our long-term valuations are highly supportive of clients holding BHP Billiton.
As always, we welcome your questions about any aspect of your portfolio. Please contact us for more information.
If you are not currently a 5 Financial client, you’re welcome to book a free, no-obligation consultation with one of our experienced wealth management advisers. Book an appointment today.
Please note, the information contained in this article and elsewhere on our website is of a general nature only. It does not take into account your specific goals and circumstances. We strongly advise that you speak with one of our experienced financial advisers before taking any action.
2018-01-22T08:14:38+00:00 January 23rd, 2012|