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Two dirt-cheap FTSE 100 dividend shares I’d buy and hold forever

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Those scouring the FTSE 100 for dividend beauties trading at bargain-basement prices need to pay DCC (LSE: DCC) close attention right now.

The business, which provides sales, marketing and support services for energy, medical and technology companies across the globe, has lifted the annual dividend by a terrific 60% during the course of the past five years. And it has hiked the dividend each and every year for close to a quarter of a century.

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A sustained period of earnings growth has allowed DCC to the pursue its generous payout policy. And with additional profits advances expected — rises of 17% and 5% are forecast for the years to March 2019 and 2020, respectively — this run is predicted to continue for some time longer.

A 136.3p per share reward is anticipated for this year, up from 122.98p last year and yielding 1.8%. The yield dial marches to 1.9% for next year, thanks to an estimated 143.5p dividend as well.

Latest trading details released last week have reinforced the positive take on DCC, with the firm advising that revenues jumped 12.6% in fiscal 2018 to £3.6bn. Sales look set to keep spiralling higher too, deepening its geographic and operational footprint through rampant M&A activity.

A forward PEG ratio of 1.2 times fails to adequately reflect this bright growth outlook, in my opinin. And I reckon this cements DCC’s brilliant earnings outlook.

The 6%-yielder

Standard Life Aberdeen (LSE: SLA) is another brilliant Footsie income share — it has raised the dividend for 11 years on the spin — that could be considered far too cheap at today’s prices.

While the asset manager is predicted to endure a 5% earnings fall in 2018, a forward P/E ratio of 12.9 times makes the business something of a bargain. Well, on paper at least.

Investors remain concerned about fund outflows at the business persisting, and this is reflected in analysts’ near-term earnings predictions which have been downgraded in recent months. And the meaty bottom-line bounceback predicted for 2019 has also been downgraded (a 1% rise is now anticipated).

I remain convinced, despite this turbulence, that Standard Life Aberdeen has the mettle to provide delicious shareholder returns in the long term. As my Foolish colleague Rupert Hargreaves recently alluded to, the loss of major client Lloyds has cast some to doubt  the group’s post-merger prospects.

However, I’m not so pessimistic. The FTSE 100 share now has the scale to really turbocharge business, and it should also reap the benefits of excellent cost savings too (indeed, Standard Life Aberdeen recently upgraded its target for annualised cost synergies to £250m, from £200m previously).

This bright long-term outlook is reflected in market-bashing dividend yields in the interim. For 2018, a 22.7p per share reward is anticipated, up from 21.3p last year and yielding an excellent 6.1%.

What’s more for 2019, the dividend is predicted to rise to 24.2p, an estimate that drives the yield to 6.6%. I am convinced Standard Life Aberdeen is a great income share to buy now and to stash away for the years ahead.

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Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has recommended Standard Life Aberdeen. 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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