BHP Billiton: stop digging

Synopsis

Joseph discusses BHP, the biggest miner in the world, whose stock has stagnated for five years. On Tuesday, BHP announces a significant restructuring, including the spin-off of the world's biggest manganese mine and other assets like nickel, alumina, and coal. This move aims to address the company's $190 billion market capitalization, which is below its potential net present value of over $200 billion. Despite these efforts, BHP's shares drop by 4%, indicating shareholder dissatisfaction due to a lack of expected cash returns, share buybacks, or special dividends. The spin-off raises concerns about the financial health of the new entity, as the financials remain undisclosed. Joseph questions whether this strategy will resolve BHP's long-term issues, suggesting that shareholders are frustrated with the current situation and the company's approach to asset management.