How the BHP share price smashed the benchmark in August

BHP shares raced ahead of the ASX 200 in August. But why?

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The BHP Group Ltd (ASX: BHP) share price was back in fine form in August.

Shares in the S&P/ASX 200 Index (ASX: XJO) mining giant closed out July trading for $39.25. When the closing bell sounded on Friday, the last trading day in August, shares were changing hands for $43.19 apiece.

This put the BHP share price up an impressive 10.0% over the month, racing ahead of the 2.6% gains posted by the ASX 200 over this same period.

Here's why August was an excellent month to own the big Aussie miner.

Why did the BHP share price surge in August?

The BHP share price enjoyed tailwinds on several fronts over the month just past.

Firstly, iron ore – BHP's top revenue earner – managed a sharp turn higher amid increasing investor optimism that stimulus measures from China will help support demand for the steel-making material from the world's second-biggest economy.

Iron ore ended July trading at US$99 per tonne. But rather than trend lower, as many analysts had been forecasting, the industrial metal topped US$102 per tonne in mid-August and finished off the month trading for just over US$101 per tonne.

Copper – BHP's second biggest revenue earner – also climbed over the month. Copper ended July trading for US$9,611 per tonne and ended August at US$9,902 per tonne, putting the red metal up 3.0%, according to data from Bloomberg.

What else were ASX 200 investors considering over the month?

The biggest news relating to the BHP share price in August was the release of miner's full-year FY 2025 results on the 19th.

Although most core metrics were down from FY 2024, the year-on-year decline in iron ore and coal prices was already broadly baked into the price.

Highlights from the 2025 financial year included revenue of US$51.26 billion, down 8% from FY 2024. Underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) of US$25.99 billion were down 10%. BHP's underlying profit of US$10.16 billion was down 26% year on year.

On the passive income front, management declared a final fully franked dividend of 92 Aussie cents per share, down 17% from last year's final BHP dividend. The miner trades ex-dividend this Thursday, 4 September.

This brings BHP's full FY 2025 dividend payout to a rounded $1.71 a share. At Friday's closing price, that sees the stock trading on a fully franked dividend yield of 4.0%.

The BHP share price closed up 1.6% on the day the company reported its results.

Motley Fool contributor Bernd Struben 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 recommended BHP Group. 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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