The Discounted Cash Flow (DCF) valuation of BHP Group Ltd (BHP.AX) is 45.13 AUD. With the latest stock price at 38.60 AUD, the upside of BHP Group Ltd based on DCF is 16.9%.

Is BHP.AX a buy or a sell?

Based on the latest price of 38.60 AUD and our DCF valuation, BHP Group Ltd (BHP.AX) is a buy. Buying BHP.AX stocks now will result in a potential gain of 16.9%.

	Range	Selected
WACC / Discount Rate	8.2% - 12.0%	10.1%
Long-term Growth Rate	1.0% - 3.0%	2.0%
Fair Price	33.69 - 69.29	45.13
Upside	-12.7% - 79.5%	16.9%

38.60 AUD

Stock Price

45.13 AUD

Fair Price

REVENUE & EXPENSES

CAPEX

D&A

WORKING CAPITAL

TERMINAL VALUE

BHP.AX DCF Valuation: Revenue & Expenses Forecast

(USD in millions)		Projections

	06-2024	06-2025	06-2026	06-2027	06-2028	06-2029

Revenue	55,658	51,456	52,804	53,860	54,937	58,675
% Growth	3%	-8%	3%	2%	2%	7%

Cost of goods sold	(22,665)	(20,954)	(21,503)	(21,933)	(22,371)	(23,894)
% of Revenue	41%	41%	41%	41%	41%	41%

Selling, G&A expenses	(2,270)	(2,099)	(2,154)	(2,197)	(2,241)	(2,393)
% of Revenue	4%	4%	4%	4%	4%	4%

Research & Development	(399)	(369)	(379)	(386)	(394)	(421)
% of Revenue	1%	1%	1%	1%	1%	1%

Net interest & other expenses	(14,276)	(13,198)	(13,544)	(13,815)	(14,091)	(15,050)
% of Revenue	26%	26%	26%	26%	26%	26%

Tax expense	(6,447)	(4,906)	(5,035)	(5,135)	(5,238)	(5,595)
Tax rate	40%	33%	33%	33%	33%	33%

Net profit	9,601	9,930	10,190	10,394	10,602	11,323
% Margin	17%	19%	19%	19%	19%	19%