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ASX shares

BHP vs Codan: Which ASX 200 Share Is the Stronger Buy Today?

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There is no evidence here for an unconditional winner. BHP offers diversified, large-scale mining exposure and substantial reported cash generation; Codan has much faster recent growth and an upgraded Communications revenue target, but limited visibility on how long conflict-related demand will last. The available market data does not establish matched-date prices and valuation measures for both shares, so whether either is the stronger buy today depends on the price you pay.

How BHP and Codan differ

BHP is a diversified miner whose results are shaped by commodities including copper and iron ore, alongside coal and potash development. Codan is a technology group with Communications and Metal Detection businesses, including Minelab detectors. They are both ASX 200 shares, but their earnings drivers, scale and risks are materially different.

Comparison BHP Codan
Latest reported year FY2026, year ended 30 June 2026; results released 18 August 2026. FY2026, year ended 30 June 2026; results released 20 August 2026.
FY2026 results Underlying EBITDA of about US$33 billion, attributable profit of US$9.8 billion and free cash flow of US$9.8 billion. BHP reported that copper contributed more than half of underlying EBITDA for the first time. (BHP FY2026 results.) Revenue of A$875.0 million, up 30%; EBIT of A$244.1 million, up 67%; and NPAT of A$175.2 million, up 69%. (Codan FY2026 results.)
Reported shareholder distributions Total FY2026 cash dividends of US$1.72 per share; payout ratio of 72%. (BHP FY2026 results.) FY2026 dividend of A$0.485 per share, fully franked and up 70% year on year. (Codan FY2026 results.)
Forward-looking growth evidence BHP describes average copper-equivalent production growth of 5% per year from FY2027 to FY2035 as an aspiration, subject to conditions—not a forecast or production target. Jansen Stage 1 potash first production was on track for mid-CY2027 in the results release. On 29 September 2026, Codan targeted FY2027 Communications revenue growth of 30–40% versus FY2026. It estimated H1 FY2027 Communications revenue of A$400–410 million and said group H1 NPAT was expected to be at least A$160 million, subject to product mix and shipments. These are company expectations, not achieved results. (Codan H1 FY2027 trading update.)
Balance sheet at the reported date Net debt below US$9 billion at FY2026 reporting; the company also reported free cash flow of US$9.8 billion for the year. (BHP FY2026 results.) Net cash of A$35.7 million at 30 June 2026. The currencies and business scales differ, so these figures are not a direct size-for-size comparison. (Codan FY2026 results.)

What supports the BHP case

Scale, portfolio and cash generation

BHP’s FY2026 results show a large, diversified mining business that generated substantial cash. The portfolio can soften dependence on any single commodity compared with a company focused on one earnings stream, but diversification does not remove exposure to commodity cycles. BHP said its results benefited from strong prices, including record copper prices; the reported year should not be treated as a promise of similar future earnings.

A longer-dated growth pipeline—with execution conditions

The copper-equivalent growth aspiration and Jansen potash project give BHP a potential long-term expansion story. That is different from near-term delivered growth: the aspiration is conditional, and projects depend on execution, capital allocation, approvals and other requirements. BHP said it expected to spend around US$11 billion per year on average on its capital program over the medium term, making delivery and investment discipline relevant to the case.

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What supports the Codan case

Rapid growth across both businesses

Codan’s FY2026 results show strong growth in revenue, EBIT and profit, with both Communications and Metal Detection contributing. That mix gives it more than one business driver, although it does not eliminate demand, execution or valuation risk. Communications performance is sensitive to orders, product mix and procurement, while Metal Detection has its own demand drivers, including interest in gold detectors.

Strong Communications guidance, but short visibility

Codan’s 29 September 2026 update points to substantial expected Communications growth in FY2027. The company also cautioned that demand from conflict regions was difficult to forecast beyond three months and that it was too early to know whether elevated demand and margins would continue into H2 FY2027. It also reported monitoring possible electronics supply-chain constraints. The guidance is therefore a meaningful growth signal, not evidence that the current pace will persist throughout the year.

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Dividends and valuation: what the available figures can—and cannot—tell you

The reported dividend amounts are in different currencies and cannot be compared as yields without share prices on the same date, consistent currency treatment and a clear assumption about future dividends. Codan’s dividend is fully franked; the value of franking credits depends on an investor’s circumstances and should not be treated as equivalent to cash paid to every shareholder.

The available market information gives Codan at A$67.45 at the 2 October 2026 close, according to delayed secondary quote data from InvestSMART. It does not establish a reliable BHP closing price for that same date or a paired set of comparable valuation inputs. That single Codan quote is not enough to show which company is cheaper. To compare valuation, obtain both prices for the same trading date and use a consistent basis, such as price-to-earnings multiples using the same earnings period, or dividend yields using clearly stated dividend assumptions.

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Risks that could change the decision

BHP: commodity prices, investment and project delivery

  • Reported earnings can move with commodity prices and production; the strong FY2026 result reflects favourable market conditions as well as operating performance.
  • The medium-term capital program and longer-range growth plans expose shareholders to project execution, approvals and capital-allocation risks.
  • BHP disclosed that a contractor was fatally injured at BMA in July 2026 and that an investigation was underway.

Codan: demand visibility and supply chain

  • Conflict-region Communications demand is hard to forecast beyond the short horizon identified by the company, and Codan did not assure investors that elevated demand and margins would continue into H2.
  • Potential electronics supply constraints could affect the ability to meet demand.
  • Strong recent growth and company guidance do not settle whether the share price already reflects expectations; valuation still needs a matched-date comparison.

Which share may fit which investor?

BHP may be more relevant to an investor seeking diversified, large-scale commodity exposure and a substantial reported dividend, while accepting price cycles, capital intensity and project risk. Codan may appeal more to a growth-oriented investor prepared to accept greater dependence on Communications demand and limited visibility into how long recent conditions may last. These are descriptions of the investment cases, not personalised recommendations; suitability also depends on an investor’s time horizon, risk tolerance, tax position and existing portfolio.

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How to make a fair “stronger buy today” comparison

  1. Use one market date: check BHP and Codan closing prices for the same trading session from a consistent, reliable market-data source.
  2. Compare like with like: calculate valuation multiples from the same earnings period and method, or dividend yields from comparable dividend assumptions. Convert currencies consistently where needed.
  3. Test the earnings case: consider how BHP’s commodity exposure and project pipeline compare with Codan’s order demand, product mix and short visibility on conflict-related demand.
  4. Match the choice to your risk: decide whether you prefer BHP’s diversified mining exposure or Codan’s faster recent growth with more concentrated demand uncertainty, then assess the price against your own assumptions.

On the evidence available, BHP has the stronger case for scale and cash generation, while Codan has the stronger recent growth momentum. Neither distinction establishes which is the better value at today’s price: a matched-date valuation comparison is needed before calling either the stronger buy.

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