Mining giant BHP Billiton Limited (ASX: BHP) has managed to edge 0.5% higher today, despite a 1.6% decline in the iron ore price overnight.
Iron ore is BHP Billiton's biggest revenue generator, and its tumbling value has been reflected in the miner's share price in recent months. Since late August, the miner's shares have tumbled an agonising 27% to be sitting near a six-year low.
The freefalling oil price has also acted as a drag on BHP more recently, but a 1.7% rally overnight may be supporting the stock today.
Although BHP Billiton remains my miner of choice – given its high level of diversification and low operational costs – now might not be the greatest time to buy. Many analysts believe that the recovery in the oil price will only be temporary while some analysts have tipped iron ore to drop below US$60 a tonne in 2015 – down from its current price of US$66.84.
Should either of these situations play out, I would expect BHP's shares to fall even further which would not only give investors a better buy price, but also a higher dividend yield. As it stands, BHP is tipped to pay $1.494 per share in dividends in FY15, putting it on a fully franked yield of 5.2%.
