Second quarter production of WA iron ore exceeded Morgan Stanley's forecast, while met coal was in line. While the quarter was considered operationally strong, cost pressures became apparent in WA.

Costs are rising due to tightness in the WA labour market and high consumables and diesel prices, explained management.

No changes were made to FY23 production guidance.

The Equal-weight rating and $42.55 target are unchanged.

Sector: Materials.

Target price is $42.55.Current Price is $49.68. Difference: ($7.13) - (brackets indicate current price is over target). If BHP meets the Morgan Stanley target it will return approximately -17% (excluding dividends, fees and charges - negative figures indicate an expected loss).

© 2023 Acquisdata Pty Ltd., source FN Arena