BHP Billiton share price: Credit Suisse sees miner as ‘outperform’

on Jun 13, 2016
Updated: Oct 21, 2019

Credit Suisse is bullish on BHP Billiton (LON:BLT) with an ‘outperform’ rating, the analysts have said. The bank still sees value in the blue-chip miner despite the Samarco disaster in Brazil in November last year.

BHP Billiton’s share price, however, has fallen deep into the red in today’s session, having lost 1.10 percent to 818.20p as of 14:24 BST. The decline is part of a broader market selloff which has seen the benchmark FTSE 100 index shed 0.92 percent to stand at 6,059.39 points. The group’s shares have lost just under 40 percent of their value over the past year, but are up more than seven percent in the year-to-date.

Credit Suisse has rated BHP Billiton as an ‘outperform’ with a price target of 1,050p today, arguing that the group’s investment case still holds despite the Samarco disaster in November which killed 19 people and caused severe environmental damage.
“While a significant and upmost serious issue, we do not think Samarco has the potential to undermine our overall positive view of the shares at this stage,” the analysts were quoted as saying, adding that they were waiting for the release of the more detailed full investigation into the tragedy.
The bank argues that BHP’s oil business sets it apart from its sector peer group, and has pointed to the miner’s recently outlined positive FY17 cost and volume guidance.
“Under spot oil, iron ore and copper prices, and within the dividend and capital expenditure guidance, BHP Billiton should have $7bn-plus of free cashflow for the year to June-2017,” Credit Suisse concluded.
BNP Paribas meanwhile remains ‘neutral’ on BHP Billiton, with a price target of 580p, while JPMorgan Chase & Co continues to see the blue-chip miner as an ‘underweight,’ valuing the shares at 800p.
As of 14:56 BST, Monday, 13 June, BHP Billiton plc share price is 817.20p.