The Motley Fool

Forget the Bitcoin price! I’d invest £1k in these 2 FTSE 100 dividend stocks today

The surging Bitcoin price may convince some investors that now is the right time to sell FTSE 100 stocks and buy the virtual currency.

However, with the index offering numerous stocks that seem to trade on low valuations, now could be an opportune moment to buy companies that offer wide margins of safety and hold them for the long run.

Claim your FREE copy of The Motley Fool’s Bear Market Survival Guide.

Global stock markets may be reeling from the coronavirus, but you don’t have to face this down market alone. Help yourself to a FREE copy of The Motley Fool’s Bear Market Survival Guide and discover the five steps you can take right now to try and bolster your portfolio… including how you can aim to turn today’s market uncertainty to your advantage. Click here to claim your FREE copy now!

In doing so, you may be able to generate a higher total return than Bitcoin. With that in mind, here are two large-cap shares that I think could be worth buying today.

Imperial Brands

Recent months have been highly challenging for investors in Imperial Brands (LSE: IMB). The company recently released a profit warning, with its performance in next-generation products being disappointing.

Despite a resilient performance from its tobacco business, Imperial Brands is forecast to post a fall in its bottom line of 1% this year. Growth of just 3% is expected next year, which could mean that investor sentiment remains at a low ebb over the medium term.

In the long run, the company’s dividend prospects could improve its overall returns. It currently yields 11.7% from a shareholder payout that is covered 1.3 times by net profit. Its high yield also suggests that its share price includes a wide margin of safety that could indicate its risk/reward ratio is highly favourable.

Clearly, the business is experiencing a period of major change. But with long-term growth forecast within next-generation products, now could be the right time to buy a slice of the business while it appears to offer a mix of income and recovery potential.

Kingfisher

Also offering a wide margin of safety at the present time is Kingfisher (LSE: KGF). The retailer has experienced a prolonged period of challenging trading conditions that showed little sign of changing in its most recent quarterly update. In fact, its sales declined by 3.2%, with the vast majority of its markets reporting a drop in their revenue.

Looking ahead, Kingfisher’s bottom line is expected to flatline in the current year. However, it is forecast to rise by 5% next year, which could prompt an improvement in investor sentiment. In this area, it has significant scope for improvement. It currently trades on a price-to-earnings (P/E) ratio of just 10.7, which suggests that investors have factored in the company’s difficult operating environment.

In terms of its income prospects, Kingfisher has a dividend yield of 5% from a shareholder payout that is covered twice by net profit. This suggests that it is affordable at the present time, and could even rise in the coming years if the retailer is able to deliver on its forecasts. As such, now may be the right time to buy it ahead of what could be an improving period for the business and its stock price.

A top income share with a juicy 5% forecast dividend yield

Income-seeking investors like you won’t want to miss out on this timely opportunity…

Here’s your chance to discover exactly what has got our Motley Fool UK analyst all fired up about this out-of-favour business that’s throwing off gobs of cash!

But here’s the really exciting part…

Our analyst is predicting there’s potential for this company’s market value to soar by at least 50% over the next few years...

He even anticipates that the dividend could grow nicely too — as this much-loved household brand continues to rapidly expand its online business — and reinvent itself for the digital age.

With shares still changing hands at what he believes is an undemanding valuation, now could be the ideal time for patient, income-seeking investors to start building a long-term holding.

Click here to claim your copy of this special report now — and we’ll tell you the name of this Top Income Share… free of charge!

Peter Stephens owns shares of Imperial Brands. The Motley Fool UK has recommended Imperial Brands. 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.