BHP shares hit 52-week low! Here’s what brokers are predicting next

It was an overall dynamic but enjoyable day for the S&P/ASX 200 Index (ASX: XJO) and many ASX 200 shares so far this Thursday. At the time of writing, the ASX 200 is up 0.29% and sits at around 7,870 points. But unfortunately, that “many ASX shares” doesn’t include BHP Group Ltd. (ASX: BHP).

This mining giant and ASX 200 stock is having a terrible day; there’s no getting around it. BHP shares closed at $39.62 each yesterday, but those same shares are currently down 1.1% at $39.18 today. What’s more, the BHP share price hit a new 52-week low of $38.76 just before midday.

This is just the latest drop in what has been a horrible year for the miner. At current prices, BHP is now down a nasty 22.5% year-to-date, including a 10.3% drop in the last month alone. The “Big Australian” is now back to the same share price it had in January 2020.

Check it all out for yourself below:

It’s not too hard to see why BHP has been having a tough time in recent months. For one thing, prices for its main commodity – iron ore – have fallen dramatically this year. As my colleague Tristan Fool explained today, iron ore has fallen from around $140 per tonne in early 2024 to around $100 per tonne today.

The pain shows no sign of abating anytime soon, with demand from China’s main iron export market plummeting.

The announcement this week of a potentially damaging strike by workers at one of BHP’s largest copper mines – Escondida in Chile – has done little to boost confidence either.

What’s next for BHP shares?

With all the bad news causing BHP shares to hit new 52-week lows this week, many investors may be wondering what’s next for the mining group. Could we see BHP sink even lower from here?

On the stock market, anything is possible. But one ASX expert who thinks this low share price represents a buying opportunity is broker Goldman Sachs.

As my Fool colleague discussed yesterday, Goldman recently issued an upbeat outlook for BHP. The brokerage gave the miner a “buy” rating, along with a 12-month share price target of $48.40. If that target comes to fruition, investors will see more than 23% upside from BHP’s current share price.

Goldman cited BHP’s “strong free cash flow generation” as one reason for its current confidence in the miner, saying it justifies a “premium valuation”. This is largely due to the free cash flow advantage of each tonne of iron ore mined in Western Australia’s Pilbara region compared to its peers.

Investors will no doubt be pleased to hear this news this week, as BHP hit a 52-week low. But let’s wait and see what happens to the BHP share price going forward.