Later today mining giant BHP Group Ltd (ASX: BHP) will release its highly anticipated full year results and reveal its earnings and dividend for FY 2021.
Ahead of the release, I thought I would look to see what the market is expecting from the Big Australian.
How big will the BHP dividend be in FY 2021?
A couple of leading brokers have recently given their opinions on the size of the BHP dividend in FY 2021 and beyond.
According to a note out of Morgans, its analysts expect BHP to report underlying EBITDA of US$37,144 million and underlying net profit after tax of US$17,674 million in FY 2021. It notes that this would be BHP’s biggest earnings since FY 2011, and a 32% increase year on year.
In light of this, the broker is forecasting full year dividends per share of US$2.81 (~A$3.84). It also expects a similar pay out the following year. Based on current exchange rates and the latest BHP share price of $51.38, this implies a dividend yield of 7.5%.
Morgans has a hold rating and $45.80 price target on the company’s shares.
A big dividend in FY 2021 but an even bigger one in FY 2022
Elsewhere, the team at Goldman Sachs are expecting a big BHP dividend in FY 2021 and then an even bigger one next year.
According to a recent note, its analysts expect the mining giant to report underlying EBITDA of US$37.2 million for FY 2021. This is expected to underpin a US$2.89 (A$3.94) per share fully franked dividend.
Goldman then expects this dividend to increase strongly next year. Its analysts have pencilled in a US$4.46 (A$6.09) per share fully franked dividend in FY 2022. This implies yields of 7.7% and 11.9%, respectively, over the two years.
Goldman Sachs has a buy rating and $57.70 price target on BHP’s shares.