BHP Group Ltd (ASX: BHP) shares have fallen further into the red in Wednesday morning trade.
At the time of writing, the ASX mining giant's shares are down around 3% for the day, and are changing hands at $56.98 a piece.
The latest slump means BHP shares have now tumbled 13% from an all-time high recorded in mid-June.
Thanks to a strong rally earlier in the year, the shares are still 25% higher year to date and around 49% higher than this time last year.
Image source: Getty Images
What caused the latest sell-off?
Improved copper prices and overall commodity tailwinds helped BHP shares reach a new all-time high in mid-June.
But this was quickly followed by another softening in the price of both copper and iron ore, which dragged BHP shares lower.
Copper futures are now around US$6.12 per pound, down from a high of around a $6.6 per pound in June.
Iron ore prices have also fallen close to an annual low of around US$98 per tonne. In mid-May, the metal was trading around the US$111 per tonne mark.
Ongoing conflict in the Middle East, sustained inflation concerns, slowing steel demand, and uncertainty about China's property sector all also weighed heavily on investor sentiment over the past month.
The question now is, what's next for BHP shares?
Are BHP shares a buy, sell, or hold?
If broker analysis is anything to go by, the mining giant's shares are now trading around fair value.
Market Index data shows the majority of brokers have a hold rating on BHP shares. Although the average $62.66 target price implies a potential 10% upside at the time of writing.
TradingView data shows the same sentiment. The majority of analysts (13 out of 19) have a hold rating on BHP shares. Another four rate the mining stock as a strong buy, and two rate the shares as a sell or strong sell.
The average $63.54 target price implies a potential 11% upside over the next 12 months, at the time of writing. But the range between the maximum and minimum target prices is huge. Some forecast the shares to fall around 31% to $39.19. Meanwhile, others are bullish that BHP shares could soar 64% to $93.75 over the next 12 months, at the time of writing.
Morgan Stanley is one of the more bullish brokers among the bunch. The investment bank recently reaffirmed its buy rating on BHP shares and maintained a 12-month price target of $67.50. The broker likes that BHP is exposed to surging copper demand and thinks the company's iron ore operations are performing well.
Elsewhere, DZ Bank recently upgraded its stance on BHP shares from sell to hold. The broker has an average price target of $65 per share.
Catapult Wealth also has a buy rating on BHP shares, citing a robust balance sheet and an attractive dividend yield.
Meanwhile, Sanlam Private Wealth has a hold rating on the mining giant and flags concerns around a cost blowout and impairment at the company's Jansen potash project and the potential for more industrial action at BHP's Pilbara operations.
