BHP and Faraday Copper: A New Era for US Copper Production?
Shares of BHP Group Limited are up in pre-market trading today as the company explores ways to unlock additional copper supply in the United States. This positive movement follows BHP signing a non-binding letter of intent with Faraday Copper Corp. to potentially restart the San Manuel copper mine in Arizona, a move that could bolster the US copper supply chain.
Reviving a Historic Mine
The potential deal centers around Faraday acquiring 100% of BHP’s San Manuel property. In exchange, BHP would receive a 30% equity stake in Faraday and participate in future capital raises up to $20 million over two years. The San Manuel mine, operational from 1955 to 1999, was once one of the most significant copper producers in the nation and the largest underground copper mine in the US at the time of its closure due to low copper prices.
Strategic Importance of Copper
This collaboration is strategically vital as the US aims for greater resilience in its copper supply chain and economic development in the Pinal County region. The combined development of the adjacent Copper Creek and San Manuel properties could benefit from existing infrastructure and enhanced capital efficiency.
BHP’s Recent Moves & Market Performance
This development comes on the heels of BHP securing a $4.3 billion silver streaming deal with Wheaton Precious Metals Corp., marking the largest precious metals streaming transaction based on initial value. Despite a generally downward market trend – the Nasdaq falling 0.05% and the S&P 500 dropping 0.03% in the previous trading session – BHP’s stock is performing positively, indicating investor confidence in the potential copper expansion.
Technical Analysis: A Bullish Outlook
BHP’s stock has increased by 44.06% over the last 12 months, reflecting strong performance. Currently, the stock trades 5.6% above its 20-day simple moving average (SMA) and 24.1% above its 100-day SMA, indicating short-term strength. The Relative Strength Index (RSI) is at 65.45, considered neutral, while the MACD indicates a bullish signal with a value of 2.6724, above its signal line of 2.5931.
Key Resistance: $75.50
Key Support: $60.50
Earnings and Analyst Perspectives
BHP Group is scheduled to release its earnings results on March 3, 2026. The consensus earnings per share (EPS) estimate is $2.00, unchanged year-over-year. Revenue is estimated at $25.18 billion, too unchanged year-over-year. The stock has a price-to-earnings (P/E) ratio of 21.2x, indicating fair valuation.
Analysts currently rate the stock as a Hold with an average price target of $51.33. Recent analyst actions include an upgrade to Buy from Argus Research (with a $68.00 price target) on December 30, 2025, and a downgrade to Neutral from Citigroup on August 20, 2025.
Benzinga Edge Ratings: Momentum and Quality
According to Benzinga Edge, BHP Group Limited’s US shares have a Value score of 67.56, suggesting the stock is fairly valued compared to its peers. Its Quality score is 40.92, indicating some weaknesses in financial health. However, the Momentum score is strong at 86.99, showing the stock is outperforming the broader market.
ETF Exposure
BHP has a significant weighting in the Optica Rare Earths &. Critical Materials ETF (NYSE:CRIT) at 9.90%. This means substantial inflows or outflows for this ETF could trigger automatic buy or sell orders for BHP shares.
Price Action: BHP shares were up 0.17% at $75.20 in pre-market trading on Friday, according to Benzinga Pro.
Frequently Asked Questions
- What is the main goal of the BHP-Faraday deal? The primary goal is to restart the San Manuel copper mine in Arizona and create a new copper hub.
- What will BHP receive in exchange for the San Manuel property? BHP will receive a 30% equity stake in Faraday Copper Corp. And the opportunity to participate in future capital raises.
- When is the deal expected to close? The deal is expected to close by the end of the third quarter of 2026.
- Why is copper production in the US important? Increased domestic copper production supports US supply chain resilience and economic growth.
Pro Tip: Keep a close watch on copper prices and industry news, as these factors can significantly impact BHP and Faraday’s performance.
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