BHP FY24 solid; still looking to grow Copper.

Wemaintain a Neutral on BHP as we expect weaker iron ore prices over 12mths+ tobalance against stronger copper prices, and shareholder returns to moderatewith higher capex. FY24 is overall in line with CF slightly ahead; BHP stillperforms to plan operationally & financially in its key divisions.Production & capex guidance is unchanged, while FY25 & 'medium-term'unit cost guidance is slightly higher than expected. We trim FY25/26 EPS by ~5%& our target by 2% to A$42/s. Iron ore remains key (65% EBITDA);fundamentals are softer than expected in 2024 with the market in surplus & pricestrending towards cost support (90th percentile US$88/t); in our opinion, BHP'svaluation is not yet compelling with the stock trading at ~5% FCF & ~4%divi yield at spot (iron ore $101/t) (interactive).While organic growth is 'Plan A', we still see a risk of BHP pursuingopportunistic M&A with organic Cu growth modest until 2030s. $BHP Group Ltd (BHP.AU)$