The Brambles Ltd (ASX:BXB) share price has risen 42.2% since the start of 2024. The BHP Group Ltd (ASX:BHP) share price is about 3.7% above its 52-week low.
BXB share price in focus
Brambles manages the world’s largest pool of reusable pallets, crates, and containers, providing a service central to most supply chains globally.
The company is better known by its main brand CHEP, which has operations across the Asia-Pacific, Americas, and Europe Middle East and Africa (EMEA) regions.
Brambles makes money through a hiring model. For example, a manufacturer will make a product, then transfer the product to a retailer on CHEP pallets. Those pallets are then transferred back to CHEP or to another manufacturer or retailer in the supply chain. At each step, Brambles collects daily hire fees on its pallets and crates.
BHP shares
BHP Group (formerly known as BHP Billiton) is a diversified natural resources company founded in 1885 that produces commodities for energy use and manufacturing.
BHP’s core business lines are mineral exploration and production. BHP’s assets, operations and interests are separated into three focus areas: copper and related minerals (e.g. gold, uranium, silver, zinc, etc.); iron ore; and coal (i.e. metallurgical and energy). While these categories make up the bulk of revenue and profit, the company is also diversifying into other areas such as fertiliser.
BHP shares have long been viewed as a reliable dividend-paying investment and are a common member of Australian share portfolios. It’s also one of the largest companies in Australia so if you own an ASX 200 ETF or LIC, or even have money in superannuation, chances are you already have some exposure to BHP shares.
BXB share price valuation
One way to have a ‘fast read’ of where the BXB share price is could be to study something like dividend yield over time. This can give us a sense of the stability of the company and whether they can consistently pay out a percentage of profits.
Remember, the dividend yield is basically the ‘cash flow’ to a shareholder, but it can fluctuate year-to-year or between payments. Currently, Brambles Ltd shares have a dividend yield of around 2.62%, compared to its 5-year average of 2.66%. In other words, BXB shares are trading lower than their historical average dividend yield. Be careful how you interpret this information though – it could mean that dividends have fallen, or that the share price is increasing, or both. In the case of BXB, the annual report shows last year’s dividend was greater than the 3-year average, so the dividend has been growing.
BHP is offering a historical dividend yield of around 5.51%, which compares to its 5-year average of 6.86%. This is just one of many ways you could put a value on BHP shares. The Rask websites offer free online investing courses, created by analysts explaining valuation methods like Discounted Cash Flow (DCF) and Dividend Discount Models (DDM). They even include free valuation spreadsheets which can help you learn how to value a company like BXB or BHP.
