BHP Group Ltd (ASX: BHP) shares are among the most popular ASX dividend shares because of the company's perceived strength and dividend yield.
The ASX mining share can offer a high dividend yield, though peers like Fortescue Ltd (ASX: FMG) and Rio Tinto Ltd (ASX: RIO) typically offer a higher yield.
However, while BHP may not always offer the highest dividend yield on the ASX, it can provide shareholders with diversification rather than dependence on a single commodity, which is appealing.
BHP produces iron ore, copper and coal. It's also working on a potash (fertiliser) project in Canada called Jansen. By generating earnings from multiple resources, the business is able to lower the risk and volatility of being exposed to just one resource.
I thought the FY26 result was a great example of the ASX mining share's ability to generate larger profits and dividends.
In FY26, BHP's board of directors increased the annual dividend per share by 56% to US$1.72.
The business reported revenue growth of 15% to US$58.8 billion, underlying attributable profit growth of 30% to US$13.2 billion, profit from operations growth of 23% to US$23.9 billion and underlying operating profit (EBITDA) growth of 27% to US$32.9 billion.
Copper was the key driver of the result, with the average realised (meaning sold) price soaring 35% to US$5.74 per pound. This helped copper's underlying operating profit (EBITDA) rise 48% to US$18.2 billion. Rising demand helped, particularly from electrification and data centres.
In this article, we're not thinking about FY26 payments. We're going to look at the potential FY27 annual dividend, which will be paid in 2027.
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2027 dividend projection for owners of BHP shares
According to the projection on CMC Invest, the ASX mining share is projected to pay an annual dividend per share of $2.07 in the 2027 financial year, representing a sizeable potential reduction for Australians.
At the time of writing, that translates into a dividend yield of 3.4% excluding franking credits and 4.9% including franking credits.
If someone were to invest $15,000 in BHP, they would be able to buy 246 BHP shares, with a little bit of money left over.
With those 246 BHP shares, investors would receive $509.22 in passive income and $727.46 overall, including franking credits.
Is this a good time to invest in the ASX mining share?
According to CMC Invest, there have been 15 analyst rating calls on the business in the last three months.
Of those 15, 13 were a hold rating, one was a buy rating, and one was a sell rating. The investment professionals are very neutral on the appeal of the company's valuation right now.
The average price target of those 15 ratings is $59.23. That means those analysts collectively predict the BHP share price could fall by 2% within the next year (at the time of writing).
For now, it seems like there are better ASX shares for Australians to buy.
