BHP Group Ltd (ASX: BHP) shares could bounce higher today as the broader market, or S&P/ASX 200 (INDEXASX:XJO), is expected to trade downwards.
Who is BHP?
BHP is a world-leading resources company, extracting and processing minerals (like iron ore and copper), oil and gas, and has more than 62,000 employees and contractors, primarily in Australia and the Americas. Headquartered in Melbourne, BHP has shares listed on both the ASX and London Stock Exchange (BHP Billiton Plc).
BHP to pay Special Dividend
Today, BHP announced the completion of its $US5.2 billion share buy-back and said it will pay a $US1.02 per share special dividend in January 2019.
“We are pleased to have completed the Off-Market Buy-Back which, together with the Special Dividend, will deliver on our commitment to return the net proceeds from the sale of our Onshore US assets to our shareholders,” BHP chief financial offer, Peter Beaven said.
“Completion of this program will bring total cash returned to shareholders to US$21 billion over the last two years.”
Around about two years ago, weak oil, iron ore and aluminium prices were taking their toll on BHP and it was forced to make tough decisions to ensure it recovered from the downturn quickly. That included cutting its dividend and selling its non-core assets.
Since 2016, BHP’s debt has fallen from over $US34 billion to around $US25 billion, it has bought back shares and its dividend is on the up.
All that is thanks to a rebound in commodity prices, savvy management and wide profit and cash flow margins.
Time to buy BHP shares?
Last week, our investment analyst took a close look at BHP shares in this article, “3 Reasons I Don’t Own BHP shares”. He noted the 5%+ dividend yield but ultimately concluded that, in his opinion, BHP shares are not in his portfolio at this time.
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Disclaimer: Any information contained in this article is limited to general financial/investment advice only. The information has not taken into account your specific needs, goals or objectives, so please consider consulting a licenced and trusted adviser before acting on the information. Please read The Rask Group’s Financial Services Guide (FSG) for more information. This article is authorised by Owen Raszkiewicz of The Rask Group, which is a corporate authorised representative No. 1264179 of Strawman Pty Ltd (ACN: 610 908 211) (AFSL: 501 223).