BHP Group Ltd (ASX: BHP) shares surged to a new all-time record $68.22 on Tuesday, taking their 2026 gain to 48% and 12-month return to 58%.
That's great news for BHP shareholders — myself included.
More than five years ago, I made one of my first Australian share purchases: BHP shares. So, how has that early bet worked out?
Let's run the numbers.
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$25,000 in BHP shares
At the end of 2020, I backed the $330 billion ASX mining giant at $36.63 per share. I invested $24,987 to buy 682 BHP shares.
What followed was an extraordinarily volatile five years. The investment began amid pandemic uncertainty, with commodity prices swinging wildly and BHP shares briefly falling into the low $30s.
Then came the commodity boom. Iron ore prices surged, BHP's profits ballooned and the stocks climbed above $50 during 2021 and 2022.
The cycle eventually turned. China's property slowdown weighed on iron ore and mining stocks, pushing BHP back towards the high $30s before the shares recovered.
The income and capital gains
With BHP shares now around $67, my original 682 stocks would be worth approximately $45,694. That represents a capital gain of about $20,707 before dividends.
But BHP isn't just a capital-growth story. Its dividends have been a major part of the investment return. Over the five-year period, the miner paid approximately $19 per share in dividends. Across 682 shares, that equates to around $12,958 in income.
Add that to the capital value and the investment has generated roughly $58,650 in total value if dividends were taken as cash. That's more than double the original investment.
Reinvesting the dividends
However, I opted to participate in BHP's dividend reinvestment plan (DRP).
Assuming the dividends were reinvested at an average share price of around $51, the original 682 BHP shares could have grown to approximately 806 shares. At $67 per share, that holding would now be worth roughly $54,002.
Compared with the original $24,987 investment, that's a gain of more than $29,000.
And the benefit doesn't stop there. Owning more shares means future dividends are calculated on a larger holding.
The DRP effectively turned volatility into an opportunity. When BHP shares traded in the $30s and $40s, reinvested dividends bought more shares. When the mining cycle recovered, those additional shares amplified the gains.
Was the BHP investment worth it?
The past five years demonstrate two important things about BHP shares.
First, the mining giant remains highly cyclical. Investors need to stomach significant swings driven by commodity prices and global demand.
Second, when the commodity cycle works in BHP's favour, its combination of earnings growth and substantial dividends can be powerful.
For a patient investor willing to ride out the volatility, my $25,000 BHP investment has turned into a holding worth more than $54,000.
Not bad for one of my first ASX share purchases.
