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These 2 FTSE 100 dividend stocks are in free-fall. Here’s why I’d buy them in an ISA today

The FTSE 100 has fallen by around 28% since the start of the year. In the short run, further declines could be ahead depending on how coronavirus impacts on the world economy’s performance. As such, share prices across the index may move lower.

However, buying shares today and holding them for the long run could be a sound strategy. The FTSE 100 has always recovered from its downturns, and investors who have purchased cheap shares during crises have generally benefitted from doing so.

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With that in mind, here are two FTSE 100 shares that have fallen heavily in recent weeks. They could offer turnaround potential in the long run.

Unilever

Unilever’s (LSE: ULVR) share price has fallen by around 16% over the past five weeks. As a global business that relies on consumers buying its products, it could be directly impacted by coronavirus. As such, the company’s near-term financial prospects could deteriorate.

This follows a disappointing end to 2019 for the company. It experienced weaker demand for its products in the fourth quarter of 2019, which contributed to it reporting a rise in underlying sales of 2.9%. This was behind guidance, and suggests that Unilever is facing a challenging outlook.

Looking ahead, Unilever plans to improve its operating performance to boost its sales outlook. It also plans to review the brands in its portfolio, notably its tea business, as it seeks to focus on sustainability to a greater extent. This may help it to resonate with customers, and could improve its competitiveness in the coming years.

Since the stock now has a price-to-earnings (P/E) ratio of 16.8 and a yield of 3.9%, it appears to offer good value for money compared to its historic averages. As such, now could be the right time to buy it for the long run.

Vodafone

Another FTSE 100 share that could be worth buying today is Vodafone (LSE: VOD). Its market value has declined by 25% since the start of the year, which is unsurprising given its reliance on the performance of the world economy for its growth.

Vodafone’s recent updates have been relatively positive. It has made efforts to improve its financial standing and investment capacity through reducing dividend payments. It is also aiming to simplify its business and how it interacts with customers, which could improve its market penetration.

Looking ahead, the telecoms company is forecast to post double-digit net profit growth in the next two financial years. Those forecasts may be reduced significantly as the full impact of coronavirus becomes clear. However, with the stock having a dividend yield of 7.1%, despite its aforementioned dividend cut, it appears to offer a wide margin of safety.

This could allow it to deliver a successful share price recovery over the long run. Buying it today may prove to be a shrewd move.

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It’s ugly out there…

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Peter Stephens owns shares of Unilever and Vodafone. The Motley Fool UK owns shares of and has recommended Unilever. 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.