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Are these 2 high dividend stocks the biggest bargains on today’s FTSE 250?

Are you looking for a share that pays a blockbusting dividend yield and offers plenty of growth prospects on top? I really think these two FTSE 250 stocks could deliver both, and come with a temptingly low share price right now.

Bad bet

Betting group GVC Holdings (LSE: GVC) enjoyed the briefest of stints on the FTSE 100, crashing out in early March. It was hit by the outbreak equine flu which led to cancelled race meetings, including Super Saturday at Newbury, that cost bookmakers up to £2m a day. Investors also took flight in March after the group’s chief executive and chairman dumped three-quarters of their shareholdings, worth £20m.

The long-feared (in the industry) Government cap on fixed-odd betting terminals from a maximum of £100 to £2 came into force on 1 April. At today’s price of 628p, GVC is down 45% from its year high. So why am I liking it?

Go West

The bad news is out there and now investors can focus on future prospects. These include gaining access to the US gambling market, now opening up after sports betting was legalised. GVC chief executive Kenneth Alexander reckons the US will be the world’s biggest regulated gambling market within five years and is targeting it via a 50:50 joint venture with MGM Resorts.

GVC, which owns the Ladbrokes Coral chain of bookmakers, is already the world’s largest gambling group. First-quarter underlying net gaming revenue rose 9%, driven by strong online revenues, although high street trading was flat. There was a surprise drop in winning margins, which means customers have been getting the better of the bookie, but that won’t last.

Buy the dip

The £3.66bn group now trades at just 9.5 times forecast earnings and offers a forecast yield of 5.6%, covered 1.7 times by earnings. Those are nice numbers. City analysts expect earnings to fall 22% in 2019, then rebound 18% next year. By then, the yield could be as high as 6.7%. Royston Wild thinks it’s a thrilling dip buy. Naturally, it’s a gamble. But what did you expect?

Now here’s an even cheaper FTSE 250 stock, with an even juicier yield. Builder Crest Nicholson (LSE: CRST) trades at just 7.7 times forecast earnings while offering an incredible forecast yield of 8.4%, with pretty decent cover of 1.5.

This combination is fairly common in the construction sector right now. For example, Taylor Wimpey trades at 8.5 times forward earnings and yields 9.6%. For Persimmon, the figures are 7.6 times and a whopping 10.3%.

Brexit blame game

Housebuilders are still making good money from the robust housing market, but sentiment has been knocked by Brexit. Also, everybody knows the market is propped up by the Government-backed Help to Buy scheme, recently extended to 2023 but for first-time buyers only. Be warned: some fear that after years of strong growth, global house prices could be set to crack.

Crest Nicholson is down 20% over the last year but its share price is in recovery mode. There may be no meaningful rally until our relationship with the EU is sorted, and that could take six months, possibly longer. Earnings are forecast to fall 12% this year. Still, there is that thumping yield while we wait for better times.

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Harvey Jones has no position in any of the shares mentioned. The Motley Fool UK has recommended GVC 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.