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3 FTSE 100 dividend stocks I’d buy in August

Uncertain market conditions are starting to spook investors. I think this is creating some good buying opportunities for long-term investors in the FTSE 100.

Today, I want to look at three FTSE 100 stocks that I rate as a buy for the month ahead.

Happy shoppers

One retailer that has consistently impressed me in recent years is Wm Morrison Supermarkets (LSE: MRW). However, despite steady progress, the MRW share price has fallen by more than 25% over the last year.

I’ve been a long-term fan of Morrisons for several reasons. One is the firm’s unique in-house food production business. This has enabled the group to expand into wholesale with very little expense. Morrisons now supplies convenience stores and has an online deal with Amazon.

I’m also attracted by the store estate, which is 86% freehold. Lease liabilities are low and the firm’s £4.6bn market cap is backed by more than £5bn of freehold land and property.

Morrisons shares were trading at 192p at the time of writing. This puts the stock on a forecast price/earnings ratio of 14, with a 4.9% dividend yield. Although growth is likely to remain modest, I think this could be a good long-term buy.

Carry on cruising

Cruise ship holidays aren’t everyone’s cup of tea. But the world’s largest cruise ship operator, Carnival (LSE: CCL), says it’s attracting an increasingly broad mix of customers.

Along with older passengers, increasing numbers of families and younger couples are climbing aboard. And demand is growing strongly in Asia, especially China.

Despite this, Carnival’s profits are coming under pressure from rising costs. In March, the company cut its profit forecasts for the current year, blaming rising fuel prices and unfavourable currency movements.

I see this as a short-term problem. The only serious risk I can see is that the company will over-expand and end up with too many ships. So far, there’s no evidence of this. Ticket sales for the current year are said to be ahead of the same point last year.

With Carnival shares now trading on 10 times forecast earnings and offering a dividend yield of 4.4%, I’m tempted to add this market-leading business to my portfolio.

Long-distance banking

I’m confident that Asia and Africa will be important growth markets over the next 20 years. But for investors with limited time and money, investing directly in these markets is difficult and risky.

To solve this problem, I own shares in Standard Chartered (LSE: STAN). This London-listed FTSE 100 bank operates in all the areas of the world where I’d like to invest, but can’t.

Last week’s results showed that underlying pre-tax profit at the bank rose by 11% to $2.6bn during the first half of the year. Return on tangible equity — a measure of profitability — rose by 0.9% to 8.4%.

Shareholders will receive an interim dividend of 7 cents per share, a 17% increase on last year.

Although the US-China trade war could affect business, Standard Chartered operates with a long-term view and I’m confident it can ride out such storms.

At a share price of about 675p, STAN stock trades at a 30% discount to its tangible book value of 977p. With profits expected to rise in 2019 and 2020, this looks decent value to me. I remain a buyer.

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John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Roland Head owns shares of Standard Chartered. The Motley Fool UK owns shares of and has recommended Amazon. The Motley Fool UK has recommended Carnival and Standard Chartered. 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.