Assessing BHP Group’s Valuation As Record Output And Autonomous Mining Progress Shape Growth Expectations

Simply Wall St.01-29

BHP Group (ASX:BHP) is back in focus after reporting record production across key copper and iron ore assets and confirming its Escondida Norte pit in Chile is now a fully autonomous operation, a rare...

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BHP’s recent 30 day share price return of 11.33% and 90 day share price return of 15.31% point to building...","collect":0,"end_time":0,"defaultTopTitle":"simplywall.st","property":[],"viewcount":null,"language":"en","relate_stocks":{"LU2065732104.USD":"ALLSPRING (LUX) WF GLOBAL SMALL CAP EQUITY \"I\" (USD) ACC","BK7507":"资源股","LU0300736492.USD":"FRANKLIN NATURAL RESOURCES \"A\" (USD) INC","LU0300736062.USD":"FRANKLIN NATURAL RESOURCES \"A\" (USD) ACC","BK7511":"ESG概念","BK7095":"多种金属与采矿","BK4168":"多种金属与采矿","BHP.AU":"BHP GROUP LTD","BK4588":"碎股","DCF":"Dreyfus Alcentra Global Credit Income 2024 Target Term Fund, Inc","BK4585":"ETF&股票定投概念","BK4097":"系统软件","BHP":"必和必拓公司","PRGS":"Progress Software Corporation"},"translate_title":"随着创纪录的产量和自主采矿进展塑造增长预期，评估必和必拓集团的估值","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"PRGS":1.5,"DCF":1,"BHP":1.5,"BHP.AU":1.5},"content_text":"BHP Group (ASX:BHP) is back in focus after reporting record production across key copper and iron ore assets and confirming its Escondida Norte pit in Chile is now a fully autonomous operation, a rare milestone for large-scale mining. See our latest analysis for BHP Group. Those operational milestones and updated production guidance have landed in a supportive backdrop for large miners. BHP’s recent 30 day share price return of 11.33% and 90 day share price return of 15.31% point to building momentum, while the 1 year total shareholder return of 34.88% shows how dividends and price gains have combined over a longer horizon. If BHP’s production story has your attention, it can be a good moment to see what else is on the move in resources and beyond. You could widen your watchlist with fast growing stocks with high insider ownership. After a strong run and with BHP trading at a discount to both analyst price targets and some intrinsic value estimates, the key issue now is simple: is there still a buying opportunity here, or is the market already pricing in future growth? AdvertisementMost Popular Narrative: 8.8% Undervalued According to Bailey's narrative, BHP Group's fair value sits at A$55.50 against a last close of A$50.60, which puts the current price at a discount and frames the recent share price strength in a different light.  Data Center and AI-Driven Copper Demand: Beyond general electrification, the explosive growth of Artificial Intelligence (AI) data centers is creating a new, capital-intensive source of demand for copper. BHP’s high-quality copper portfolio (including Escondida and Copper South Australia) is described as being well positioned to serve this sector, which requires significant copper cabling and power infrastructure, potentially tightening the global supply deficit sooner than expected.  Read the complete narrative. Curious how this copper story supports that higher price tag? The narrative leans on long run demand, margin resilience, and a valuation multiple usually reserved for faster growing sectors. The real interest is how those pieces fit together across decades of projected cash flows. Result: Fair Value of A$55.50 (UNDERVALUED) Have a read of the narrative in full and understand what's behind the forecasts. However, this copper and potash upside competes with real risks, including weaker Chinese steel demand hitting iron ore cash flows and potential cost blowouts at projects like Jansen. Find out about the key risks to this BHP Group narrative. Another View: Our DCF Flags A$39.89 Fair Value Bailey’s A$55.50 fair value suggests BHP is 8.8% undervalued. Our DCF model lands in a very different place, with a fair value of A$39.89 versus the current A$50.60. That points to an overvalued share price and raises a simple question for you: which narrative feels more realistic? Look into how the SWS DCF model arrives at its fair value. BHP Discounted Cash Flow as at Jan 2026Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out BHP Group for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 877 undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.  Build Your Own BHP Group Narrative If you are not fully on board with either view or you just like kicking the tyres on your own assumptions, you can stress test the numbers, shape a thesis that fits your outlook and Do it your way in a few minutes. A great starting point for your BHP Group research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision. Ready to hunt for more opportunities? If BHP has sharpened your thinking, do not stop there. Broaden your search now with screeners built to surface focused, high conviction ideas before others spot them.  Target resilient income by reviewing these 14 dividend stocks with yields > 3% that may appeal if regular cash returns matter to you. Chase growth potential in emerging tech by scanning these 24 AI penny stocks that are tied to artificial intelligence themes. Spot potential mispricings by checking these 877 undervalued stocks based on cash flows where market prices and cash flow estimates differ.   This article by Simply Wall St is general in nature. We provide commentary based on historical data\n    and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your\n    financial situation. We aim to bring you long-term focused analysis driven by fundamental data.\n    Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.\n    Simply Wall St has no position in any stocks mentioned.Valuation is complex, but we're here to simplify it.Discover if BHP Group might be undervalued or overvalued with our detailed analysis, featuring fair value estimates, potential risks, dividends, insider trades, and its financial condition.Access Free AnalysisHave feedback on this article? Concerned about the content? Get in touch with us directly. 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