Financial Performance of BHP: Analysis, Share Price, Bond Price, and Recommendations

FINANCIAL PERFORMANCE

TABLE OF CONTENTS
INTRODUCTION ..........................................................................................................................1
ANALYSIS......................................................................................................................................1
2.1.................................................................................................................................................1
2.2.................................................................................................................................................2
2.3.................................................................................................................................................4
2.4.................................................................................................................................................5
2.5.................................................................................................................................................5
REFERENCES................................................................................................................................7

INTRODUCTION
Financial performance is subjective measure about how well the firm could use the assets
from primary mode of the business and could generate revenues. It also refers to measure of the
overall financial performance of the company during given time period. BHP is trading entity of
the BHP Group and Anglo Australian multinational metals, mining and petroleum listed public
company which is headquartered in the Melbourne, Victoria, Australia. BHP is dual listed
company which are BHP Biliton Limited and British BHP Biliton plc are listed separately with
separate shareholders, conducting business as single operation with common board of directors
and single management structure. The company is a multinational company serving round the
world. Total revenues of company in 2019 were US $44.288 billion and net income of US$
9.185 billion. Total assets of company were US $100.861 billion and equity of of US$ 47.240
billion. It is performing well in the market and is growing at constant rate.
ANALYSIS
2.1
Intrinsic value of share price of BHP
Dividend 0.765
Growth 1.50%
Re 5.00%
Price =
Dividend /
( Re –
Growth)
0.765*(1.015)
(0.05 – 0.015)
Share Price of BHP 22.185
Intrinsic value of the share is price for share which is solely based over factors inside
company. This excludes the external factors of the market prices. Share price could be calculated
using dividend discount model and other methods. Dividend growth model uses dividends paid
by the company and the growth with which dividends will be increasing (Grifell-Tatjé and
1