When it comes to dividends, BHP Group Ltd (ASX: BHP) has long been one of the market's heavyweights.
Each year, the mining giant returns billions of dollars to its lucky shareholders.
But how many BHP shares would you actually need to generate a $1,000-a-year second income?
A $1,000 income from BHP shares
To find out, we must first start with an estimate for what BHP may pay to shareholders over the next 12 months.
According to analysts at Morgan Stanley, which currently have an overweight rating and a $46.50 price target on BHP shares, they expect the mining giant to pay fully franked dividends of approximately $1.75 per share in FY 2026.
This means that you would need 572 BHP shares to earn a $1,000 annual second income.
At the current share price of $39.64, it would cost approximately $22,674 to purchase that many shares.
That might sound like a lot of money to tie up in one ASX share but remember that Morgan Stanley's price target suggests material upside potential of 17.3% over the next 12 months. This would turn that original investment into $26,598. And that doesn't include dividends.
Growing your way to $23,000
Of course, not everyone has a spare $23,000 sitting in cash, ready to deploy into BHP shares.
The good news is that with consistent investing and time, it is possible to grow a portfolio to this level.
Let's say you invested $500 a month into ASX shares and earned an average return of 10% per annum (a level broadly in line with long-term equity market averages, though not guaranteed).
In just over three years, your portfolio could grow to around $23,000 — which is enough to fund the purchase of 572 BHP shares at today's price.
This demonstrates the power of compounding and disciplined investing. Even relatively modest contributions, when invested consistently, can build up quickly.
Foolish takeaway
It would take an investment of about $22,674, or 572 BHP shares, to lock in a $1,000 annual second income at Morgan Stanley's projected dividend for FY 2026.
If you don't have that lump sum yet, building a portfolio through monthly contributions can get you there in a matter of years. Once achieved, you're not just holding a slice of one of the world's largest miners — you're also securing a steady stream of dividend income that could keep flowing for years to come.
