One broker just put a $38 price target on BHP Billiton (ASX:BHP) shares

1206

The BHP Billiton (ASX:BHP) share price has jumped 44 per cent higher in the last 12 months, making it one of the top performing ASX 200 stocks over that period.

BHP shares are currently trading at $34, but analysts at Macquarie think there could be further gains ahead.

According to a note out of the investment bank, Macquarie analysts have an outperform rating on BHP shares, and a $38 share price target.

That implies a further 11 per cent upside to BHP shares, not including the company’s fully franked dividend.

And BHP’s dividend shouldn’t be ignored. While commodity prices are high, and with BHP focused on productivity and not on value destroying acquisitions, the mining giant will be spewing cash.

According to Commsec, the BHP full year dividend for FY18 will be around $1.60, meaning BHP shares trade on a forecast fully franked dividend yield of 4.7 per cent, or 6.7 per cent when grossed up for franking credits.

According to the Macquarie note, the broker expects BHP to complete the sale of its shale assets in 2018. This will give BHP a significant cash balance to use for share buybacks.

Last month, BHP Chief Executive Andrew Mackenzie said its pipeline of new opportunities has the potential to add a further 40 per cent to the value of BHP.

BHP is a member of The Capital Club 10, a basket of ASX 200 companies I think will beat the traditional blue chips over the next 3 years.

For the latest BHP share price quote, chart and BHP news, click here

Here’s how you can strike it rich in the share market…

The best way to strike it rich in the share market is to buy shares that are not only cheap, but growing quickly.

Combining countless hours of research with over 30 years of hands-on stock market investing experience, The Capital Club’s founder Bruce Jackson has just published his definitive list of 3 Cheap and Good ASX Stocks for 2018.

Best of all, the report is absolutely free, exclusively for readers of The Capital Club.

In this comprehensive free report, you’ll find the name of one ASX gold stock that’s not only profitable, but trading at less than 4 times forecast profits.

You’ll also discover the name of a company one fund manager has called the cheapest stock in the ASX 100, and you’ll read about the three catalysts that could push the share price higher in the next six months.

Finally, the report names one of the cheapest retailers trading on the ASX, a company that just picked up the assets of a distressed competitor on the cheap, paying just 2 times earnings. No wonder one top fund manager thinks its share price could at least double.

With the share prices of each of these 3 companies having the potential to double or more, you’ll want to act now. Simply click here or the button below, enter your email address, and this free report will be instantly sent to you.

See the 3 stocks

Contributors to this article may own shares in some of the companies mentioned in this article. The Capital Club has a thorough disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
Avatar
Bruce Jackson has 30 years of hands on investing experience. He is passionate about stock market investing, running his own portfolio and SMSF. His focus is on small cap growth stocks. You can contact Bruce at brucej@thecapitalclub.com.au