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Why BHP Group Ltd (ASX:BHP) Is Going To Pay A BIG Special Dividend

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.”

Now What

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.

Looking For Big Dividend Stocks In 2019?

If you’re looking for big dividend stocks in 2019 you should take a look at the 3 shares in the free investing report below.

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$50,000 per year in passive income from shares? Yes, please!

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So how do the best investors do it?

Chief Investment Officer Owen Rask has just released his brand new passive income report. Owen has outlined 10 of his favourite ETFs and shares to watch, his rules for passive income investing, why he would buy ETFs before LICs and more.

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