BHP Billiton Share Discussion Threads

[rickmay] 15/1/2016 07:45

OOPPS news not very good.TARGET £2 to £3

[togglebrush] 15/1/2016 06:27

CNBC {
BHP's shares, which sank to a 10-1/2 year low this week, jumped 5 percent on Friday, in line with other miners in what is seen as an oversold market

[tpaulbeaumont] 15/1/2016 03:43

the folly of chasing a potential 10% dividend tomorrow whilst taking a very real 40%-50%-60%-70% capital loss today never fails to amaze me lol

[edjge2] 14/1/2016 18:35

BLT booted up about thesame time as AAL and seems to coincide with large gold fall today.

[idioterna] 14/1/2016 14:16

…sounds like more dividends to investment bankers than shareholders, in my opinion. As a pensioner I'd like to see bread today, not jam tomorrow.

[loganair] 14/1/2016 10:15

I hope in the not too distant future that BHP will be able to pick up one or two good assets at distressed prices from companies that are desperate to just try and stay a float.

[kendownie] 14/1/2016 10:10

Some interesting well thought post regarding BHP & RIO. The main being the oversupply of iron ore and the likelihood that the smaller more expensive producers will fold helping the the big 2.The market makers are also manipulating the price of the 2 companies. + there is the usual rant from Rickmay about his predictions without any justification as to his reason.

[essentialinvestor] 14/1/2016 09:31

I hold RIO, they are a focussed play on IO.
BHP more diversified.

Both BHP and RIO should survive and go on to thrive just IMV,
it will be a very bumpy ride, as of late, and I can't call the lows here,
there may be heavy further falls still to come.

In years to come people will look back at these prices and think what
an opportunity, trouble is at the time it is very difficult to see and think
like this.

Just my take only and I could be wrong!.

[joy division still] 14/1/2016 09:09

EI - thanks it was the ballpark IO percentage i was looking for.

Assuming the 'other producers half their supply ( due to bankrupt ) will the loss of 10% world supply help return the IO price to nearer $50 per ton. It seems to me that until that type of supply side change happens nothing will materially improve.

[essentialinvestor] 13/1/2016 23:28

Depends what commodity you are referring to.

In IO 4 companies control about 78% of current supply, from memory.

At the other end of the spectrum BHP's O&G business is tiny on a global scale.

[joy division still] 13/1/2016 23:02

It is assumed Rio bhp vale will keep production high to squeeze the high cost produces out of business. But does anyone know the percentage these 3 make up. The reason is I'm trying to understand how many higher cost producers have to stop / go out of business before the big 3 can stabilise the ore price.

[rickmay] 13/1/2016 21:49

TRUST ME GUYS ...IT'S GOING TO £2 to £3 .It's coming folks.

[sirhedgealot] 13/1/2016 19:45

That was bloody well said. The rats have grown bigger than ever.

[idioterna] 13/1/2016 14:10

The type of behavior we are witnessing here and in RIO is exactly why Glass-Stegal should never have been abolished. Investment bankers talking the share price down and telling BLT to cut dividends so they have funds to acquire assets. And who profits from the mergers and acquisitions…? You guessed it, the same bloody investment bankers who are talking your share holdings down. Is this the mysterious market at work? No it's the financial maffia. We can only pray that Hilary intends to do penitence for Bill's sins.

As an aside one should note that their is nothing untoward in commodity price drops toward the end of a cycle. What is untoward is investment banks talking the share prices down and trying to force a dividend cut to harm shareholders and line their own pockets from an acquisition process. The fact they also have enormous leverage at their disposal just exacerbates a reprehensible behavior. If you don't regulate them this is what happens.

[herbyrainer] 13/1/2016 09:03

Sorry Rickmay my tea leaves say otherwise....

[rickmay] 13/1/2016 07:37

DIVI CUT ???? £2 to £3 it's coming folks. Metals still falling ..oil still falling. TARGET £2 to £3.

[rickmay] 12/1/2016 22:58

IT'S COMING FOLKS!!
BACK ON TRACK £2 to £3 !!! it's coming folks

[idioterna] 12/1/2016 20:11

The dividend yield is 12.12%, not 13.4%. There has been no indication of a dividend cut by management. In fact the most recent statement included an anticipation of weakening prices into 2016. If management have anticipated this why change policy now? It's the investment banks that want Billiton to save the cash for acquisitions. Thus they profit twice from shareholders. It's disgusting behaviour and should be both illegal and punishable.

[loganair] 12/1/2016 19:55

Telegraph - BHP Billiton tumbles amid fears of dividend cut

Shares in BHP Billiton faltered after two banks downgraded the stock, while the FTSE 100 stabilised after a torrid new year start.

The commodity price crunch has taken its toll on mining giant BHP Billiton as two banks moved to slash the stock’s rating amid fears it will be forced to half its dividend.

Barclays downgraded the FTSE 100 stock to “underweight” as the collapse in commodity prices has left the miner “generating virtually no earnings”. “BHP is at a crossroads for its progressive dividend,” said David Butler, of Barclays. If commodity prices remain at current levels , the bank believes a dividend cut of 50pc will be “inevitable221;, which would place its chief executive Andrew Mackenzie under further pressure, in the wake of the recent dam burst at Samarco.

Even a dividend cut of this magnitude would still require further cuts to the group’s capital expenditure, the bank said. In November, Jac Nasser, chairman, said in respect to the dividend versus the credit rating that “the balance sheet must always come first”. “We will never put it at risk.”

HSBC lowered BHP’s rating as it also sees the miner halving its dividend at its results. Ash Lazenby, of HSBC, said: “While weak producer currencies offer some support, continued renminbi weakening has negative commodity read-across.”

In a sector wide note, Barclays also warned of an “uneasy year ahead” for commodities. The bank thinks the lack of growth momentum in the developed world, due to China-led malaise and the ongoing recession in emerging markets, such as Brazil and Russia, are likely to restrain any visible commodity demand recovery this year.

Despite swinging between gains and losses, BHP Billiton’s share price was unable to dodge the double downgrade. The FTSE 100 tumbled 18.2p, or 2.9pc, to 617.9p.

[loganair] 12/1/2016 19:52

Now, all eyes are on whether BHP Billiton will do the same. Being a low-cost producer, with an EBITDA margin of around 50%, may make it seem odd that BHP will cut its dividend. Net debt is reasonable too, at $24.4 billion, or 1.1x EBITDA. Still, the company is not immune to pressure to cut its dividend.

Its progressive dividend policy will likely put BHP into a free cash flow shortfall of at least $1 billion in 2015. And with commodity prices extending 2015’s losses, this shortfall is only expected to widen going forward.

Abandoning its progressive dividend policy will be a tough move for management, given how resolutely it has previously committed itself. But by releasing cash that is being used on dividends to finance debt reduction and potential acquisitions, whilst asset prices are low, would make sense.

Doing so would allow the company to increase the chance of being able to maintain its coveted investment grade credit rating, allowing the miner to borrow more cheaply than many of its rivals. Together with additional asset optimisation, this could widen BHP’s competitive advantage, and potentially rewarding shareholders much more in the longer run.

BHP’s current dividend yield of 13.4% could be seen as an indication that a dividend cut this year is likely. And with a dividend cut seemingly likely, its shares could still fall further.

[loganair] 12/1/2016 19:50

HSBC downgraded BHP Billiton to 'reduce' from 'hold' and cut the price target to 590p from 1,100p saying the company faces further headwinds from oil and iron ore.

The bank said it assumes a 50% dividend cut and eliminates most non-essential capex, which leaves BHP around $2bn cash destructive post dividend over calendar year 2016.

"We think the Samarco incident fallout (we assume $3.5bn fines) will continue to weigh, limiting rationale for a 'premium' valuation," said HSBC, noting that the stock screens as expensive and iron ore spot has significant downside risk.

HSBC said that while an equity issue could be a way to secure extra funds, the market is likely to be super critical of the asset quality and price tag.

More generally, the bank said it expects seasonal weakness in the first quarter to maintain pressure on commodities.

Base metals may stabilise towards mid-year with supply-side cuts and China policy action, it said.

It added that while weak producer currencies offer some support, continued renminbi weakening has negative commodity read-across.

[idioterna] 12/1/2016 19:48

Yep, maybe everybody should just stop producing everything and we could all bask in the warm glow of the New Economy. What's Appening to the world? It doesn't take long for phones & tablets to break, or cars and busses for that matter. Guns and tanks need hard steel. But luckily we won't need any of them in the virtual society.I just hope the price is still down here when the dividend drops in.

[rickmay] 12/1/2016 08:32

BACK ON TRACK £2 to £3 !!! it's coming folks