Stock market volatility in 2022 leaves long-term investors with ample opportunities to grab some bargains. Here are two low-cost dividend shares on my radar right now.
Go for gold
Having gold exposure is a popular strategy for many investors. The yellow metal often rises during economic, political and social crises. This can help prevent individuals’ investment portfolios from getting washed out in difficult times.
I think buying gold-producing shares is the best way to get this exposure. And I’d do this by investing in FTSE 250 stock Centamin (LSE: CEY).
I’m encouraged by the company’s plans to turbocharge production at its Sukari mine to 500,000 ounces per year. The business is on track to dig between 430,000 and 460,000 gold ounces in 2022.
It’s also taking big steps to reduce costs. Last week it began the final stages of commissioning a solar plant at its Egyptian mine. The plant is already “delivering savings ahead of expectations”, Centamin said.
I also like the exceptional all-round value that the miner’s shares provide today.
The FTSE 250 company trades on a forward price-to-earnings (P/E) ratio of 8.2 times. Meanwhile its dividend yield sits at 5.6% and 6.3% for 2022 and 2023 respectively.
Searching for, developing, and producing from mineral deposits are all complex processes. This allows for a broad range of problems that can happen anytime to push up costs and hammer revenues.
But on balance I think that the potential long-term rewards of owning Centamin shares make it a great buy.
Latin fever
Owning banking stocks such as Banco Santander (LSE: BNC) can be a bumpy ride.
Earnings for such stocks are highly attuned to the broader economic conditions. This means that share prices can slump when times get tough. Dividends can also take a whack during difficult periods.
Santander last week underlined the problems it is facing. Head of its UK business Mike Regnier told The Guardian newspaper that the number of people falling behind on mortgage, loan and card payments is increasing.
But as a long-term investor I’m still considering buying Santander shares.
A sinking share price leaves the business on a forward P/E ratio of 4.8 times. Its 2022 dividend yield meanwhile sits at an enormous 6%.
This offers exceptional value, in my opinion. I think the Spanish bank will soar from current levels once the global economy recovers and banking product demand in Latin America steadily grows.
Santander has operations in major South American economies including Brazil, Mexico, Chile, and Argentina. It is investing heavily in these developing regions too to turbocharge future earnings growth.
An explosion in fintech platforms underlines in part how fast demand for financial products is growing. The number has more than doubled in Latin America between 2018 and 2021 to reach 2,482 last year.
Santander’s shares trade on a forward P/E ratio of 4.8 times. Meanwhile its dividend yield for 2022 sits at 6%. This all makes the bank a highly attractive value stock right now.
