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The tastier the yield the more likely it will get cut. One wonders how they can justify paying out a dividend when as yet they (like BP) do not as yet know the extent of the financial cost of the disaster....and just like in the BP case everyone else is going to "dump" the blame firmly at BHP and Vale's door ....despite the fact that the Brazilian's apparantly only checked the dams every 4 years
It's possible that a dividend reduction will provide a stable footing. The yield is very tasty at the momement.
Cut the divi in half and from today's sp, you still have 4.5% yield. And I don't think it'd be that drastic, going from progressive increase to 50% cut. Still an attractive buy I would say.
BHP Billiton hints at dividend cut Mining giant BHP Billiton (BLT) may be forced to sacrifice its dividend policy in order to maintain strength in its balance sheet. ‘BHP has apparently started hinting that it may slaughter the sacred cow named progressive dividend policy, should this prove necessary to ensure survival during a worsening commodities famine,’ said Shore Capital analyst Yuen Low. ‘In his AGM statement, chairman Jac Nasser said that BHP’s “starting point is to maintain the strength of the balance sheet through the cycle”, and that “the balance sheet must always come first”. ‘The dividend level is regularly reviewed taking into account “the background of the external environment, BHP’s progress on capital and operating productivity and the need to invest to ensure profitable long-term growth”.’ Shares in BHP Billiton rose 0.9% to 888.9p yesterday.
Well, not many listening to them then! Graph looking good so far today. Obvious really that blt have underperformed recently with the scale of the Brazil disaster. 850 was a bargain for this this morning.
BHP Billiton: ‘massive underperformance’ http://citywire.co.uk/money/the-expert-view-standard-chartered-lloyds-and-asos/a858866?ref=citywire-money-latest-news-list#i=4 Mining giant BHP Billiton (BLT) has plunged further into trouble with ‘massive underperformance’. Liberum analyst Richard Knights retained his ‘sell’ recommendation and target price of 830p on the shares, which were broadly flat at 880.1p yesterday. ‘BHP’s massive underperformance versus the sector over the past fortnight has gone far beyond any plausible financial downside from the Samarco tragedy [a burst dam in Brazil], however there are other valid drivers,’ he said. ‘We now set out target price at 830p, a 25% discount to base no par value (from 20%), reflecting price deflation risk.’ He added that ‘despite sharp share price decline, BHP has actually re-rated over the past three months, with the share price fall lagging its declining earnings’.
strange that blt jv'ed with them? DD of JV partner particularly sensitive/important in mining sector, no?
BBC Fivelive now talking about the damage to the environment and the loss of life - mentions that it will cost an estimated 4 to 5 billion USD to put things right. Presumably that is a conservative figure perhaps and there will be a fine on top? Fivelive said something about the owners of the mine being, allegedly, major donors to the ruling political party and, allegedly, also to the main opposition party in Brazil and questions now being asked in Brazil about this - no idea whether that is true or not? Interesting BBC item though.
but uk macro foundations weak
beatrootjuice from what I've read BHP have behaved well with the critiscism being levelled at the other JV holder, obviously tremendously sad.
Truly unbelievable. 19 people still missing too.
440km ?? Jesus.....
A US report has stated that the markets have lost control. Billionaires now have the ability to move the market any which way it suits them. Once they start buying again only those selling on the lows will lose. China may be taking a breather but India is waking up and today the UK has signed big trade deals with them. Today's problem and as always is Saudi Arabia and unfortunately Cameron still needs them for the 5.6 billion arms trade it runs with them. In return Cameron gets oil and by the time he sells it to 60 million brits that 5.6 billion is now worth 22 billion. The problem here is that we never complain. We should be paying 60 pence a litre but like idiots we pay £ 1.10. So; get the cost down or get the Arabs to cut. Same goes for Obama, the preacher of carbon reduction that promotes massive oil extraction, sells cars for peanuts and does nothing to cure the Arab madness that incident only five years ago stated " WE ARE RUNNING OUT OF OIL" There is an agenda here and it's getting dangerous. Pensions have to be paid and depleting TOP STOCKS of value and dividends will come round and bite back hard. All you have to decide is this: IS AN UTTER IDIOT RUNNING THE COUNTRY.
However, if the report that bhp have shown negligence and little remorse is correct, it sickens me that I have invested in such a company. Nuff said.
Give em a break mate. Look at what has just happened in Brazil and the clean up, and compensation costs to be had. Both IO and oil were twice the price in 2010 than they are today and copper was 50% higher. Although this has room to fall further, you just can't allow for a disaster such as what has happened. Really don't think it's doing too bad compared to five yrs ago when all is taken into account. Divi now standing at nearly ten % probably won't last but even a 50% cut will yield almost 5% and I would say they definately won't suspend it totally. Sxxt happens, just gotta roll with it and count your blessings you're not one of the tragic casualties of this disaster. Atb.
BLT's shares are coming down as if there is no safety net. Even at the time of market crash (2010) the shares stood firmly at around £10.
morons haven't lost their money on uk listed miners lol
indeed...i also wonder at the eps differential with its peers...perhaps blt's diversified pf better? But not enough to justify differential imv
More rumors of a div cut. In 2017
This has took such a hit since the disaster it could jump on any sentiment improvement.This project is not that significant in production terms but it is more sentiment/potential clear up compensation costs I suppose.Of course very sad for all involved.Mining shares may have their time again,but it seems likely to be a long/tough ride. GLA
SP becomes largely irrelevant at times like these. Thoughts go out to the deceased and their loved ones. Take care all.
Awful news. Thoughts go out to those affected. http://www.wsj.com/articles/mining-company-samarcos-dam-bursts-in-brazil-1446763579
half of the middle east needs rebuilding. India has just about started and Africa will follow but not in my life time. The markets are obsessed with China and the heard of morons follow.
Having had a look at the last 3years EPS, then the 2015 figures (40p from 150p in 2014), things aint look great for the dividend. http://tools.morningstar.co.uk/uk/stockreport/default.aspx?SecurityToken=0P00007O0M]3]0]E0WWE$$ALL Estimates for 2016 at 36p. 2017 50p. Dire!
BHP Billiton better off together as dual-listing questioned: BHP Billiton’s 14-year listing on the London Stock Exchange is under threat, as financial issues weigh on the Anglo-Australian company. BHP’s dual listing in London and Australia is under renewed focus ahead of tomorrow’s shareholder annual meeting in the U.K. capital. The AGM comes as profits tumble and the company defends rising dividends. The dual listing was created through a marriage of equals when British-based Billiton merged with Australian group Broken Hill Proprietary Company (BHP) in 2001. The deal brought BHP’s huge Australian coal, iron and copper assets together with Billiton’s aluminum, nickel and manganese mines. It also gave the company access to the deep pockets of mining investors in London to fund acquisitions. here are concerns Down Under that with markedly lower profits the company simply cannot afford its large dividends, and investors in London are being paid out of Australian pockets. This is because the iron ore and coal mines in Australia are the most profitable part of the group, and in order to fund dividends to London shareholders, reserves must be transferred from Australia to the U.K.. Australian investors will vote on this issue at their annual meeting in Perth on 19 November. While it is true that the more profitable mines in Australia are supporting the dividend payments, it is too simple to argue that the dual listing should now be unwound. What’s more, this stance is unlikely to garner serious support. The top two investors in BHP’s Australian-listed entity are U.S. groups BlackRock and Vanguard, which own more than 7% of the shares. None of the top international investors is opposing the transfer of reserves from Australia to the U.K.. BHP Billiton at £10.93 -3p. Questor says “Sell”.