7.4% + dividend yields! 2 FTSE 100 dividend stocks I’d hold for 10 years

Image source: Getty Images.

I’m searching for the best FTSE 100 dividend stocks to buy for my portfolio in May. Here are two which offer dividend yields far above the 3.5% FTSE 100 average. I think they could make me some terrific shareholder returns over the next decade at least.

ITV (7.4% dividend yield)

As consumer spending comes under pressure, I think now could be a good time to buy ON TV (LSE: ITV) shares.

5 Stocks For Trying To Build Wealth After 50

Markets around the world are reeling from the current situation in Ukraine… and with so many great companies trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains.

But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be a daunting prospect during such unprecedented times.

Fortunately, The Motley Fool UK analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global upheaval…

We’re sharing the names in a special FREE investing report that you can download today. We believe these stocks could be a great fit for any well-diversified portfolio with the goal of building wealth in your 50’s.

Click here to claim your free copy now!

Competition from streaming companies remains a significant danger for the FTSE 100 broadcaster. However, subscriptions for Netflix, Amazon and other paid-for services are slumping (down 1.5m in the first quarter) in Britain as people tighten their belts. This bodes well for the free-to-air media giant.

I believe the outlook for ITV remains rosy for the next decade too. The business has invested heavily in its own ITV Hub platform to capitalize on the streamlining phenomenon. And this is causing viewing figures to rocket (streaming viewing hours jumped 22% year-on-year in 2021).

I like the ambitious plans ITV has to turbocharge its streaming operations too, with the launch of its new ITVX platform later this year. The broadcaster expects these measures to double digital revenues by 2026, to £ 750m.

Finally, I like the rapid expansion that ITV continues to pursue for its ITV Studios arm. The production division is now a global production heavyweight and its shows like Love Island spirit The Chase sold all over the globe. The business remains dedicated to growing the unit and last year launched new production arms in Spain and Germany to help grow its international footprint still further.

Today, ITV trades on a price-to-earnings (P / E) multiple of just 5.3 times for 2022. It’s a figure I do not believe fully reflects the FTSE 100 firm’s excellent earnings potential in the near term and beyond.

Rio Tinto (10.6% dividend yield)

I’m also thinking of buying Rio Tinto (LSE: RIO) shares to make money from the predicted commodities ‘supercycle.’

Demand for raw materials is tipped to surge over the next decade. Trends like the growth of green energy, rapid urbanization in emerging markets, and robust infrastructure spending across the globe are expected to supercharge consumption mining commodities.

This bodes well for diversified miners like Rio Tinto. This FTSE 100 produces copper, iron ore and aluminum among other things, metals that will provide the backbone for those aforementioned trends.

The problem for Rio Tinto is that revenues could slump if commodity prices weaken. This could happen, for instance, if the cost of living crisis continues and the global economy sinks.

Still, it’s my opinion that this danger is baked into the mining giant’s rock-bottom share price. Rio Tinto trades on a forward P / E ratio of just 6.5 times. This reading is well inside the widely-regarded value bargain watermark of 10 times and below.

Leave a Comment

Advertise