2 FTSE 100 dividend shares I’d buy to own for 10 years!

I think these FTSE 100 shares could be among the best for long-term investors right now. Here’s why I’d add them to my own investment portfolio.

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

A young black man makes the symbol of a peace sign with two fingers

Image source: Getty Images

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

I don’t have unlimited reserves of capital I can use to buy UK stocks. So for the time being I’m building a list of FTSE 100 shares I plan to invest in.

Here are two British blue-chips I plan to buy if I have spare cash to spend.

Antofagasta

The process of mining for raw materials is extremely complex. Even the biggest and best-run commodities company can endure sudden and severe problems that can take a big bite out of earnings.

Take Antofagasta (LSE:ANTO) for instance. Production at the copper giant slumped 10.4% last year to 646,200 tonnes, due to two major problems at its Chilean operations. Droughts hit water supplies while a pipeline leak affected copper concentrates supply.

This, combined with lower copper prices, caused pre-tax profit to fall 26% from 2021 levels.

Yet despite these risks, I still believe investing in big miners like this is a good idea. It’s why I own Rio Tinto shares in my stocks portfolio.

Riding the supercycle

The world is tipped to embark on a fresh commodities supercycle. Trends such as soaring demand for renewable energy and buoyant construction activity in emerging markets are tipped to turbocharge demand for industrial metals.

Firms like Antofagasta should be well-placed to exploit this raw materials boom. Indeed, research from S&P Global illustrates the huge earnings potential for copper producers in particular.

Analysts predict that “copper supply shortfalls [will] begin in 2025 and last through most of the following decade”, a scenario that could lift metal prices.

They also say demand will double between now and 2035 and that “substitution and recycling will not be enough to meet the demands of electric vehicles, power infrastructure, and renewable generation”.

Chart showing projected copper demand.
Source: S&P Global

Antofagasta is expanding its operations to take advantage of a favourable price landscape too. Ongoing expansion at its flagship Los Pelambres mine, for one, will boost annual copper production by 60,000 tonnes over the first 15 years.

Further supply issues could cause some earnings volatility. But I’d still back it to deliver exceptional long-term profits growth.

Segro

For different reasons I believe real estate investment trust (REIT) Segro (LSE:SGRO) could also be a top stock for me to own for the next decade.

This FTSE 100 share builds, acquires and then lets out so-called big box commercial properties. These are the sorts of assets for which demand is booming as e-commerce continues to grow. They are popular bases for manufacturers, retailers and couriers alike.

However, supply of these critical properties is failing to meet this growing demand. And so Segro continues to enjoy impressive rental income growth (like-for-like rents grew almost 7% last year). A weak development pipeline in the UK market means this shortfall looks set to persist.

It’s true that company profits could suffer in the near term as the economy splutters. The business could find it more difficult to collect rents from its tenants in this landscape. But over the long term I still expect Segro shares to deliver excellent investor returns.

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 assessed. Consider taking independent financial advice.

Royston Wild has positions in Rio Tinto Group. 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.

More on Investing Articles

Close-up of British bank notes
Investing Articles

£8 per year in extra income for life, for each £100 invested today? Here’s how!

Christopher Ruane explains how he would aim to set up extra income streams for the rest of his life by…

Read more »

Photo of a man going through financial problems
Investing Articles

With a £20K Stocks and Shares ISA, I’d target £1,964 in annual dividends like this

With an annual passive income target close to £2,000, our writer explains how he'd put a £20K Stocks and Shares…

Read more »

Illustration of flames over a black background
Investing Articles

Down 63% in 2024, what’s going on with the Avacta (AVCT) share price?

2024 has been a difficult year for many companies in the biotechnology sector, with the AVCT share price down heavily.…

Read more »

Warren Buffett at a Berkshire Hathaway AGM
Investing Articles

Here’s how I’d invest £800 the Warren Buffett way!

Christopher Ruane learns some lessons from super-investor Warren Buffett he hopes could improve his own stock market performance.

Read more »

British Isles on nautical map
Investing Articles

Michael Burry just bought 175,000 shares in this FTSE 100 company

Scion Asset Management announced a $6.5bn stake in BP this week. But what could Michael Burry be seeing in an…

Read more »

Young Asian woman holding a cup of takeaway coffee and folders containing paperwork, on her way into the office
Investing Articles

£5,000 in savings? Here’s how I’d aim to start making powerful passive income today

With a cash lump sum to invest, this Fool lays out how he'd start making passive income. He also details…

Read more »

Investing Articles

Just released: our 3 top small-cap stocks to consider buying before June [PREMIUM PICKS]

Small-cap shares tend to be more volatile than larger companies, so we suggest investors should look to build up a…

Read more »

Passive income text with pin graph chart on business table
Investing Articles

My best FTSE 250 stock to consider buying now for passive income while it’s near 168p

This is a rare stock with a growing underlying business and a fat dividend yield – it’s worth consideration for…

Read more »