BHP shares (ASX:BHP) fell 2.53% today to close at A$51.23, yet still managed to eke out a 1.71% weekly gain heading into the extended Easter holiday weekend, as Berenberg Bank upgraded the mining giant from Sell to Hold despite trimming its price target.
The dual-listed miner experienced a volatile session across both Sydney and London exchanges. On the ASX, BHP retreated from recent gains as broader risk-off sentiment weighed on materials stocks, with escalating conflict in the Middle East pushing oil prices higher and unsettling global equity markets. Meanwhile, the London-listed shares traded at 2,689 pence when Berenberg announced its rating change, moving the stock from Sell to Hold while simultaneously reducing its price target from 2,600 pence to 2,500 pence.
The upgrade marks a notable shift in sentiment from one of BHP’s more vocal bears. Berenberg cited a lack of negative catalysts and potential shareholder return upside as key factors behind the decision, acknowledging that much of the bearish case around elevated capital expenditure, rising net debt, and dividend coverage concerns has already been reflected in the share price. The firm’s revised stance comes as BHP maintains a market capitalisation of approximately A$260billion, making it the second largest name on the ASX, 10% behind CBA.
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Thursday’s decline occurred against a backdrop of heightened geopolitical tension, with the ongoing Iran conflict creating volatility across commodity markets and pressuring cyclical stocks.
The ASX materials sector bore the brunt of the sell-off, as concerns about global growth trajectories and the prospect of higher-for-longer interest rates dampened appetite for large-cap miners. Despite the daily retreat, BHP’s weekly performance demonstrates resilience following a brutal March correction that saw the stock plunge more than 20% from its all-time high of A$59.35 at the beginning of last month (March 2nd).
BHP’s operational performance has remained solid, with the company reporting record or near-record production across copper and iron ore in its fiscal 2025 results, even though revenue and earnings declined year-on-year due to weaker commodity prices. Net debt climbed to US$12.9 billion from US$9.1 billion in the prior year, reflecting the company’s substantial investment programme while remaining within management’s stated US$5-15 billion comfort zone.
Broker consensus on BHP has coalesced around neutral ratings, with price targets clustering modestly above or near current trading levels. The Berenberg upgrade to Hold, while removing one prominent bear voice, stops short of endorsing the shares as a compelling buy at current valuations, instead suggesting that downside risks have been substantially priced in following the March correction. However, the firm’s price target of 2,500 pence still implies modest downside from current London trading levels, underscoring lingering concerns about the earnings outlook and capital intensity.
With the Easter break providing a pause in trading, markets will return next week ready to go again.
