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I’d buy these 2 bargain FTSE 100 dividend stocks in an ISA to get rich and retire early

Finding top FTSE 100 dividend stocks for your portfolio has become harder as dozens of companies suspend their payouts during the pandemic. Roughly half the index has now halted dividends, but don’t despair, there are plenty of top income shares out there.

FTSE 100 dividend stocks like the two I’m looking at here are great building blocks your retirement portfolio. Simply reinvest your dividends for growth while still working, then use them to top up your pension income later. It’s a great way to get rich over the longer term, and possibly even retire early.

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I feel every investor should have exposure to commodity stocks such as metals and mining giants Anglo American (LSE: AAL) and Rio Tinto (LSE: RIO).

I’d buy these two FTSE 100 dividend stocks

Ever since the millennium, commodity stocks have been driven by demand from China, and that is still the case today.

This morning, the Anglo American share price is up 2.26%, Rio Tinto up 2.33%. Yet neither company has made any major announcement. This is purely due to a spike in Asian markets, as analysts look forward to positive Chinese second-quarter and trade figures out this week. They reckon the world’s second-largest economy is bouncing back from the pandemic, and natural resources stocks will reap the benefit with a rise in demand for steel, copper and iron ore.

This could be your opportunity to buy these FTSE 100 dividend stocks ahead of the next leg of the recovery. Both Anglo American and Rio Tinto fell sharply in the March crash, as you would expect. They have recovered surprisingly well, though. Their share prices are up 34% and 26% respectively over the last three months.

Stock market crash bargains

Again, this isn’t due to individual company developments, but wider sentiment. That’s what’s driving the share prices of these FTSE 100 dividend shares today.

Wise investors turn a stock market crash to their advantage, because it gives them the opportunity to buy their favourite stocks at bargain prices. In a sell-off, good companies get dumped along with the bad. Right now, these both look like solid companies, temporarily available at bargain prices.

Anglo American, for example, trades at just 8.84 times earnings, with Rio Tinto at 9.16 times. While traditional valuation metrics such as the P/E ratio are not wholly reliable, these still look tempting entry prices to me.

Even better, these two FTSE 100 dividend shares offer juicy income streams. Anglo American currently yields 4.53%, Rio Tinto 6.37%. That looks particularly attractive, given the carnage elsewhere. 

Anglo American looks relatively solid, having taken the opportunity to shrink its debts in the good times. That is paying off in the pandemic. The Rio Tinto share price has underperformed the wider natural resources sector, and may be able to play catch up.

Given the dearth of FTSE 100 dividend stocks, both look exciting buys for long-term investors.

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Harvey Jones has no position in any of the shares mentioned. 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.