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I’d buy this 5.8% FTSE 100 yield, and this dividend growth hero, for my ISA RIGHT NOW

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As a shareholder in Barratt Developments (LSE: BDEV) I’m quite looking forward to the release of interim results on Wednesday, February 5. The other housing stock that I own, Taylor Wimpey has also put in bright financials of its own recently. Though it’s of course not alone in this regard and newsflow from across the sector has been quite brilliant.

Barratt certainly impressed the market again last time out in September. With completion rates up (and running at 11-year highs) and work to improve margins paying off, pre-tax profit at the FTSE 100 firm jumped around 9% in the first half of 2019 to £909.8m. Average selling prices have been more subdued of late to thanks to weakness in the London market. Though signs of improvement have emerged here following last month’s general election.

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Whether or not the so-called ‘Boris Bounce’ will persist, though, it’s likely that Barratt’s property prices will remain robust enough to keep profits moving higher. The competition to offer the country’s cheapest mortgages continues to hot up, meaning that demand for homes continues to outstrip supply. And there’s nothing to suggest that this supply shortfall will be solved any time soon.

Too cheap!

City analysts expect earnings to dip 1% in the fiscal year ending June 2020. This negative prediction fails to worry me, though. Unexpected resilience across the housebuilding sector has seen brokers steadily upgrade their annual forecasts since the Brexit referendum of summer 2016. I fully expect them to steadily upgrade their estimates for Barratt again, and possibly as soon as when those fresh financials come out next week.

At current prices the Footsie business trades on a mega-low forward P/E ratio of 11.2 times. It also sports a monster 5.8% corresponding dividend yield. These great readings allow plenty more space for Barratt’s share price to rise and add to the 51% advance it has enjoyed during the last 12 months.

Dividend growth hero

I’m also tipping Coca-Cola HBC (LSE: CCH) as a top Footsie share to buy today. Indeed, I reckon it’s a good share to load up ahead of full-year trading details on Thursday, February 13. I reckon another set of solid numbers could be in the offing.

I’ve long lauded the titanic brand power of the Coke stable. So beloved is the firm’s range of drinks that annual profits continue to grow by double-digit percentages, and City analysts expect this to remain the case. A 12% earnings rise is currently forecast for 2020, and the strong third-quarter update of November shows exactly why they are so bullish.

Coca-Cola has lit a fire under annual dividend growth in recent years. And is expected to keep doing so, too (a 10%-plus increase in the total payout is currently forecast for 2020). A forward P/E ratio of 20.8 times might make it expensive on paper, but the potential for hot profits and dividend expansion in the near term and beyond still makes this FTSE 100 share an attractive buy in my opinion. And an inflation-beating 2.1% dividend yield provides an added sweetener.

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Royston Wild owns shares of Barratt Developments and Taylor Wimpey. 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.

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