11%+ dividend yields! 2 FTSE 100 shares I’d buy right now

With plenty of UK shares trading at a discount, I’m on the hunt for the best dividend-paying FTSE 100 stocks to buy today.

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With the stock market having taken a bit of a tumble, plenty of FTSE 100 shares are offering double-digit dividend yields today. Typically seeing such a high payout can be a giant red flag as it’s often a precursor to a dividend cut. However, I’ve found two stocks that might be an exception and could potentially unlock an enormous income opportunity.

Double-digit income from the FTSE 100

With supply lines being disrupted and demand still rising, it’s hardly surprising to see raw material prices go through the roof. It’s been quite the tailwind for Rio Tinto (LSE:RIO), whose profits more than doubled last year.

Mining is a complicated industry. But one of its key characteristics is the fixed-cost nature of operations. Consequently, any rise in commodity prices translates almost entirely into margin expansion, enabling the group to pay out a whopping 11.6% dividend yield today!

It’s worth noting that this advantage is also a doubled-edge sword. If metal prices start to fall, then margins can quickly evaporate, taking dividends with it. And we’re already seeing some commodities, like copper, start to drop as fears of a recession continue to mount.

But with a diversified portfolio of mining assets, $15.2bn of cash on its books, and a shrinking debt balance, this FTSE 100 stock looks like it’s in prime financial shape. And while commodity prices obviously won’t go up forever, the shift toward renewable technologies offers a strong catalyst for long-term growth. At least that’s what I think.

12.6% dividend yield

Another sector that seems to be thriving at the moment is housing. Homebuilders like Persimmon (LSE:PSN) have largely managed to capitalise on rising house prices, sending profits to record highs. In fact, this particular FTSE 100 homebuilder has continued to grow its top line since the start of 2022.

As of April this year, the average selling price for one of Persimmon’s homes stands at £260,000 versus the pre-pandemic level of £215,700. And despite the inflationary challenges or rising raw material costs, management is successfully passing on these additional expenses to customers. Subsequently, the group still maintains its impressive 27% operating profit margin.

Despite this, shares have dropped by a third over the last 12 months. And this dip might be justified. Government support schemes for homebuyers are due to end this year. Combining this looming hurdle with rising interest rates has many fearing a sudden drop in house prices.

The risk is undeniably there. But panicking investors may have over-reacted. The FTSE 100 stock has a forward order book of £2.8bn that provides a nice buffer for the bottom line and, in turn, dividends. That, to me, suggests the group’s currently 12.6% dividend yield can be maintained. And it’s an opinion matched by management, which recently increased the per share dividend to 235p.

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.

Zaven Boyrazian has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. 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.

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