Best FTSE 100 stocks to buy: 2 shares that cost less than £5!

I’m looking for great value UK shares to add to my shares portfolio. I think these two could be among the best FTSE 100 stocks for me to buy today.

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I’m searching for the best cheap FTSE 100 stocks to buy in 2022. Here are two brilliant blue-chips on my shopping list today.

Aviva

Aviva’s (LSE: AV) a FTSE 100 share that offers terrific all-round value at current prices. Costing below £5, the insurance giant trades on a price-to-earnings (P/E) ratio of just 9.4 times for 2022. At the same time it boasts a bulging 6% dividend yield. That far exceeds the broader 3.4% Footsie average.

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Like all stocks, Aviva exposes investors to risk. Not only could revenues suffer if economic conditions in its key UK marketplace suffer (unlike general insurance, demand for life insurance tends to slip when times become tough). It also faces intense competition from the likes of other FTSE 100 shares M&G and Legal & General, to name just a couple of its big rivals.

However, I think there are more reasons for me to buy Aviva stock right now than to avoid it. There’s that exceptional value for one. I’m confident the insurer’s terrific cash generation should provide many more big dividends looking ahead as well. Furthermore, the company’s divestment of poor-performing overseas assets will improve profits and gives it more financial heft to improve its core businesses. Aviva’s cash-rich balance sheet is one big selling point for an investor like me. This also prompted Aviva to raise its share buyback target in December, let’s not forget, to a whopping £1bn from £750m previously.

HSBC Holdings

Buying banking shares could be a bumpy ride for UK share investors in the near term. The economic recovery is still vulnerable and the outlook for cyclical stocks like HSBC Holdings (LSE: HSBA) remains fraught with danger. The battle against Covid-19 remains taxing and lockdowns persist. At the same time, surging inflation is hitting business and consumer confidence hard.

Asia-focused shares like HSBC are also under threat from China’s deteriorating real estate sector. Property developers like Evergrande, Kaisa and Shimao are all struggling to repay their debts and fears are rising that this could spark economic chaos in China and spread to surrounding nations.

Could it be argued that HSBC’s low cost prices in these risks, however? The FTSE 100 trades on a forward P/E ratio of 10.2 times, after all. This sits around the widely-regarded bargain benchmark of 10 times and below.

I’m actually tempted to buy HSBC at current prices. That’s because I’m thinking the banking giant’s huge exposure to Asia could deliver spectacular long-term returns. Economic growth in the region is expected to outstrip that of the West, sending demand for financial products to the stars. And HSBC is investing heavily to make the most of this opportunity. For instance, it’s spending $3.5bn over the next five years and taking on 5,000 staff to build its Asian wealth business.

Besides, HSBC also offers splendid value from an income perspective. Its dividend yield for 2022 sits at a meaty 4.5% at the bank’s current price below £5. I also think this is a top FTSE 100 stock to buy today.

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Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has recommended HSBC Holdings. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Should you invest the value of your investment may rise or fall and your Capital is at Risk. Before investing your individual circumstances should be considered, so you should consider taking independent financial advice.

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