It's been a bouncy yet pleasant day overall for the S&P/ASX 200 Index (ASX: XJO) and many ASX 200 shares so far this Thursday. At the time of writing, the ASX 200 has gained a decent 0.29% and is up to around 7,870 points. But unfortunately, those 'many ASX shares' don't include BHP Group Ltd (ASX: BHP).
This ASX 200 blue-chip stock and mining giant is having an awful day; there's no way around it. BHP shares closed at $39.62 each yesterday, but those same shares are currently down a chunky 1.1% at $39.18 today. Moreover, the BHP share price hit a new 52-week low of $38.76 just before midday.
This is just the latest drop in what has been a horrid year for the miner. At the present pricing, BHP is now nursing a nasty loss of 22.5% year to date, including a 10.3% collapse over the past month alone. The 'Big Australian' is now back to the same share price it was trading at way back in January 2020.
Check that all out for yourself below:
It's not too difficult to understand why BHP has been having a rough time over the past few months. For one, the prices of its major commodity – iron ore – have declined dramatically this year. As my Fool colleague Tristan discussed today, iron ore has gone from around US$140 a tonne at the start of 2024 to approximately US$100 a tonne today.
The pain doesn't look like it will ease anytime soon either, with demand from the key iron export market of China precipitously dropping.
News this week of a potentially damaging worker strike at one of BHP's largest copper mines – Chile's Escondida – hasn't exactly helped boost confidence either.
What's next for BHP shares?
With all of this bad news sparking the new 52-week lows for BHP shares that we are seeing this week, many investors might be wondering what's next for the miner. Could we see BHP sink even lower from here?
Well, anything is possible on the stock market. But one ASX expert who thinks this low share price represents a buying opportunity is broker Goldman Sachs.
As my Fool colleague covered just yesterday, Goldman has recently come out with a bullish outlook on BHP. The broker gave the miner a 'buy' rating, alongside a 12-month share price target of $48.40. If that is realised, it would see investors enjoy an upside of more than 23% from the current BHP share price.
Goldman cited BHP's "strong free cash flow generation" as a reason for its confidence in the miner right now, arguing that it justifies a "premium valuation". That's largely thanks to the free cash flow advantage from every tonne of iron ore mined in the Pilbara region of Western Australia over its peers.
Investors will no doubt be happy to hear this news this week as BHP sinks to its new 52-week low. But let's wait and see what happens with the BHP share price going forward.
