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I think these FTSE 100 dividend stocks offer a LOT of value right now

While the FTSE 100 is at a relatively high level right now and not that far off its all-time high, there is still plenty of value to be found within the blue-chip index. As always, there are stocks that are out of favour. Here’s a look at two FTSE 100 dividend stocks I believe offer a lot of value at present. 

WPP

The first value opportunity I want to highlight is WPP (LSE: WPP), which is one of the largest advertising companies in the world and supports nearly three-quarters of the Fortune 500. It currently trades on a forward-looking P/E ratio of 10.7 (versus the FTSE 100 median of 15.6) and sports a prospective dividend yield of an attractive 6%.

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Now, I won’t deny that WPP has experienced challenges over the last three years. Revenue and profits have declined as the company has faced structural changes in the advertising market. However, the FTSE 100 firm has recognised that it needs to evolve and has undergone quite a significant transformation. I like its new strategy – not only has it sold off non-core assets to become a more streamlined outfit, but it has also increased its focus on technology and data, which should help it win more business in an increasingly digital world.

Recent results suggest the transformation is working. For example, in October, the group showed a return to revenue growth and also advised that it recently landed a number of new clients, including eBay and Mondelez. WPP’s share price has shown signs of a recovery too – it has rebounded nearly 20% over the last year. Yet I think this could be just the beginning of the turnaround story. Analysts at JP Morgan recently raised their target price to 1,150p from 1,100p – 14% higher than the current share price.

Aviva

Another FTSE 100 company that I believe offers a lot of value at present is financial services group Aviva (LSE: AV). Its forward-looking P/E ratio is just 7.1 and its prospective dividend yield is a high 7.9%.

Like WPP, Aviva recognised recently that it needed to evolve in order to remain competitive. Major investors were concerned that the firm lacked direction and a robust strategy. As a result, it has now simplified its business into five main operating divisions (investments, savings, and retirement; UK life; Europe life; Asia life, and general insurance) and set out ambitious targets for the next three years.

In addition, Aviva is now focusing on excelling at the fundamentals (insurance underwriting and claims, investment performance) and improving the customer experience, while investing for the future in an effort to transform the company into a simpler, stronger and better business. “I am committed to running Aviva better,” said CEO Maurice Tulloch late last year.

Naturally, it could take some time for Aviva’s new strategy to generate results. However, with a near-8% yield on offer, you’ll get paid handsomely to wait. If you like value stocks, I think Aviva shares are certainly worth a closer look right now.

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Edward Sheldon owns shares in WPP and Aviva. The Motley Fool UK has recommended eBay and recommends the following options: long January 2021 $18 calls on eBay. 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.