The BHP (ASX:BHP) share price is down 17% in September so far. What’s next?

BHP is having a month to forget…

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man scratching his head as if asking whether the bhp share price is in the buy zone

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It certainly has been a disappointing month for the BHP Group Ltd (ASX: BHP) share price.

The mining giant’s shares finished the week with a decline of almost 2% to $37.72.

This means the BHP share price is now down 17% since the start of September.

What’s next for the BHP share price?

Where the BHP share price goes next will largely depend on commodity prices.

However, unlike Fortescue Metals Group Limited (ASX: FMG), which only produces iron ore, BHP has a diverse portfolio of operations across several commodities. This means the company has some protection from the weakening iron ore price.

In light of this, could the recent pullback in the BHP share price be a buying opportunity for investors?

Is this a buying opportunity?

The team at Macquarie appear to believe this is a buying opportunity.

In fact, just last week the broker retained its outperform rating and $56.00 price target on its shares.

Based on the current BHP share price, this implies potential upside of 48% for the company’s shares over the next 12 months.

And that’s before dividends. Macquarie is also forecasting a fully franked 10% dividend yield in FY 2022.

What else is being said?

Last week analysts at Morgans retained their hold rating with a price target of $45.20. This still implies potential upside of 20%, which isn’t bad for a hold rating!

The main reason the broker isn’t upgrading BHP or Rio Tinto Limited (ASX: RIO) shares to a buy rating just yet is its belief that iron ore prices could still fall further.

It commented: “We remain bearish on iron ore in the short term and think it has further to fall. We are watching steel numbers closely but find it impossible to gain any positive conviction while iron ore is in freefall.”

“Both stocks are trading around accumulate territory but again we remain cautious given the poor state of their largest exposure,” Morgans added.

Should you invest $1,000 in BHP right now?

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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