Own BHP shares? Here's what to expect from the miner's Q1 update

Will the Big Australian impress or disappoint with its quarterly update next week?

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Next week, BHP Group Ltd (ASX: BHP) shares will be in focus when the mining giant releases its latest quarterly update.

Ahead of the release, let's take a look to see what the market is expecting from the Big Australian on 18 October.

BHP quarterly update preview

According to a note out of Goldman Sachs, it is expecting BHP to report production declines across the board during the first quarter of FY 2024.

From the miner's copper operations, the broker has pencilled in production of 439Mt, which is down 8% quarter on quarter. The consensus is a little more positive and expects copper production to come in at 450Mt for the three months.

As for its key iron ore operations, Goldman is forecasting production of 68.8Mt. This represents a quarter on quarter decline of 3%. Though, once again, the market is expecting a stronger result, with the consensus estimate implying a modest quarter on quarter lift in production to 71.6Mt.

Finally, Goldman believes that met coal and nickel production could disappoint with 16% and 19% declines quarter on quarter, respectively. This will mean met coal production of 71.Mt (versus consensus 7.4Mt) and nickel production of 17.9kt (versus consensus 19.6kt).

Are BHP shares a buy?

Despite forecasting below-consensus production from the mining giant, Goldman still has a buy rating and a $46.50 price target on BHP's shares. This implies a modest upside of 3.3% from current levels.

Elsewhere, the team at Morgans is more bullish and has a buy rating and a $50 price target on its shares. This suggests a more appealing 11% return over the next 12 months.

In addition, both brokers are forecasting attractive dividend yields in FY 2024. Goldman expects a 4.35% yield and Morgans expects a 6.3% yield.

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 positions in and has recommended Goldman Sachs Group. 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 Scott Phillips.

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