Zacks Investment Research downgraded
BHP Billiton Plc.
) to a Zacks Rank #4 (Sell) from a Zacks Rank #3 (Hold) on Mar
Why the Downgrade?
BHP has witnessed sharp downward estimate revisions after
reporting disappointing fiscal half-year 2013 results. On Feb 20,
BHP Billiton reported half-year earnings per share of 79 cents,
down 58.0% from $1.88 in the year-ago period. The company's
earnings were primarily hurt by lower selling prices as well as
BHP's revenue also dropped 14.1% year-over-year to $32.2
billion, due to reduced prices of commodities as well as a
challenging global industry. The price of BHP's core product,
iron ore, decreased drastically in the first-half of fiscal 2013,
thereby pulling down the revenue. Upsurge in oil prices and
rising core inflation in the emerging markets further added to
BHP Billiton faces industry-wide pressure from equipment
shortages, labor crises and volatile metal and mineral prices.
Its dependence on third party suppliers for mining equipment has
risks. Moreover, depleting natural resources call for an
improvement in ore grade and subsequent search for new mines,
increased the R&D costs.
The Zacks Consensus Estimate for fiscal 2013 decreased 3.0% to
$5.15 per share over the last 60 days. For fiscal 2014 also, the
downward estimate revision pressure reduced the Zacks Consensus
Estimate by 7.5% to $5.82 per share.
Other Stocks to Consider
The following mining stocks with favorable Zacks Rank are
Dominion Diamond Corporation Co
) carries a Zacks Rank #2 (Buy)
) holds a Zacks Rank #2 (Buy)
US Energy Corp.
) holds a Zacks Rank #2 (Buy).
BHP BILLITN LTD (BHP): Free Stock Analysis
DOMINION DIAMND (DDC): Free Stock Analysis
UR-ENERGY INC (URG): Free Stock Analysis
US ENERGY CP-WY (USEG): Free Stock Analysis
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