BHP Billiton Limited (ASX: BHP) has seen its share price fall below $15, losing 3% in early trading to trade at $14.56.

Further falls in iron ore and oil prices overnight, and expectations that they have both yet to hit bottom were the main culprits.

BHP generated nearly 60% of revenues and 74% of earnings before interest and tax (EBIT) just from iron ore, petroleum and potash in the 2015 financial year, and prices have fallen significantly since then.

The big miner also faces declining prices for its other two major commodities – coal and copper. Earnings for coal and copper last financial year fell 39% and 28%, despite similar levels of production compared to the previous year.

Revenues and earnings will clearly be much lower in the 2016 financial year, and share prices generally follow earnings. BHP could also be forced to write down the value of its assets, particularly its oil and gas assets, which suggests that it is difficult to value the company based on a price to book basis.

At the end of June 2015, the company had US$70.5 billion worth of net assets versus a market cap of around A$75 billion, indicating BHP is trading on a price-to-book ratio of less than one. But as we’ve seen with its spinoff South32 Ltd (ASX: S32), that’s no fail safe method. South32 is currently trading on a price to book ratio of well below one – roughly 0.3x according to CapitalIQ, with BHP on 0.9x.

South32’s share price has continued to plummet since splitting from BHP, falling from above $2.00 to trade around 87 cents currently.

Foolish takeaway

With commodities prices more than likely to continue falling – and stay low for many years, BHP’s 11.5% fully franked dividend yield is likely to be cut – despite the company’s vow to maintain its progressive dividend policy.

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Motley Fool writer/analyst Mike King doesn't own shares in any companies mentioned. You can follow Mike on Twitter @TMFKinga

Unless otherwise noted, the author does not have a position in any stocks mentioned by the author in the comments below. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.