Bank of America has nudged up its earnings forecasts for BHP, the world's largest listed miner, even after a September quarter that fell short on copper production. In a research note published Tuesday, the bank described the period as “maintenance heavy,” but argued that the shortfall was largely baked in and that stronger prices for key commodities helped offset the weaker volumes.
BHP produced 400.7 kilotonnes of copper in the quarter, a figure that missed expectations. The bank attributed the miss to two familiar culprits: lower ore grades at Escondida in Chile, the world's largest copper mine, and disruptions at BHP's Copper SA operations in South Australia. These are issues that have dogged the miner in recent quarters, and BofA said they were “largely expected.”
Iron ore steady, prices lend a hand
On the iron ore side, volumes from Western Australia Iron Ore (WAIO) were steadier, providing some stability to the overall result. BofA also pointed to pricing as a positive, noting that realized copper and iron ore prices came in stronger than anticipated. That combination—volumes roughly in line for iron ore, and better prices across the board—was enough for the bank to lift its medium-term earnings estimates for the miner.
The move is notable because it comes at a time when copper markets are in focus. Copper is a key input for electrification, from electric vehicles to power grids, and its price has been volatile as investors weigh near-term demand against longer-term supply constraints. BHP, with its large copper portfolio, is often seen as a bellwether for the metal's outlook.
Olympic Dam visit could shift the narrative
Looking ahead, BofA said it still expects a site visit to BHP's Olympic Dam operation in November to “nudge consensus toward BHP’s longer-term copper targets.” Olympic Dam, a sprawling underground mine in South Australia, produces copper, uranium, gold, and silver. It has been a focus of BHP's growth plans, and the company has outlined ambitions to expand output there over the coming years.
The bank's view suggests that while the recent quarter was soft, the longer-term story remains intact. For investors, the site visit could provide a clearer picture of whether BHP can deliver on its copper growth targets, which are central to its investment case.
What it means for investors
For everyday investors, the key takeaway is that a single weak quarter doesn't necessarily derail a company's longer-term prospects, especially when the shortfall is driven by known, temporary factors. BofA's decision to raise forecasts despite the miss signals that the bank sees the underlying business as healthy, and that pricing strength is helping to cushion the blow.
However, it's worth remembering that analyst forecasts are just one input into investment decisions. BHP's share price will continue to be influenced by commodity prices, global economic growth, and operational execution. Copper prices, in particular, are sensitive to the health of the Chinese economy, which is a major consumer of the metal.
Investors should also keep an eye on the broader mining sector. Other miners have reported mixed results recently, with some beating profit forecasts while others have warned of persistent volatility. For example, DNB beat third-quarter profit forecasts despite tougher lending competition, and SKF beat forecasts but warned that volatility still clouds demand. These reports highlight that while some companies are managing well, the macroeconomic environment remains uncertain.
In the copper space specifically, Grupo Mexico saw third-quarter profit jump 56% on copper prices, but trimmed its 2026 output guidance, underscoring the mixed signals in the market. Meanwhile, Northern Star Gold sales rose 7.2% but missed forecasts due to shutdowns, showing that operational hiccups are common across the sector.
The bottom line
BofA's forecast upgrade is a vote of confidence in BHP's ability to manage through a soft patch. The November Olympic Dam visit could be a catalyst, potentially aligning analyst expectations more closely with the company's own longer-term copper ambitions. For investors, the story is less about one quarter's numbers and more about whether BHP can execute on its growth plans in a commodity market that remains hard to predict.
As always, it's wise to consider a range of sources and not rely solely on a single analyst's view. But when a major bank raises forecasts despite a miss, it's a signal worth paying attention to.
