2 undervalued dividend shares I’d buy as the FTSE 100 tumbles

I hope to take advantage of falling stock prices from many FTSE 100 company. The UK benchmark has taken a beating as the ongoing banking crisis has taken a toll on stock markets in the US and Switzerland so far.

When volatility rises, I look for beaten-down dividend stocks that could be a good buy for my passive income portfolio. After all, selling a wide market can offer unique opportunities. Macro factors often reduce the value of healthy businesses.

With that in mind, there are two Footsie dividend stocks that look cheap to me right now.

Legal & General

At Legal & General Changes in the price of LSE.LS shares in Euros over the past year. But just a few days ago, the stock was essentially flat on a 12-month basis.

The sharp decline in the asset manager’s stock following the collapse of Silicon Valley Bank means that the current price could be an attractive entry point for me.

Legal & General currently offers a dividend yield of 8.6%, which is higher than the average of the FTSE 100. Sometimes an unusually high yield can be a worrying sign, but I don’t think that’s the case here.

Indeed, I believe this dividend stock is oversold. Legal & General recently increased its operating profit by 12.5% ​​for the year to £2.5bn. What’s more, cash income of £1.9bn represents an increase of 14%. Importantly, the company’s solvency II ratio also increased by 49% to reach 236%.

The combination of a strong balance sheet and strong cash generation allowed the board to raise its annual dividend by 5% to 19.37p.

Of course, challenging bond market conditions pose risks. Volatility in 2022 ravaged the group’s investment portfolio, reducing the value of assets under management by £225bn. A litany of recent bank failures did not help the situation.

However, the company’s numbers look encouraging overall and I don’t mind the stock price movement. If I had the money, I would invest in Legal & General stocks for a passive income stream.

WPP

The world’s largest advertising agency, WPP (LSE:WPP), has also suffered in the past two weeks. The stock price is down 15% on a 12-month basis.

Currently, WPP shares are yielding 4.3%.

I believe the recent trading action for this stock has created another good example of the mismatch between the company’s fundamentals and its value. Therefore, I think WPP might be an attractive buy for me right now at the current share price level.

The company’s full-year results show evidence of financial strength. Annual pre-tax profits increased by 22% to £1.16bn and the group announced a big increase in its final dividend per share, up 31% to 24.4p.

New accounts helped the company in 2022, with a net business win of $5.9bn. Important names in the client book are now included Amazon-owned audiobook provider It can be heard and giant French food Danone.

Future guidance is also optimistic. WPP expects to generate organic revenue between 3% and 5% in 2023.

Admittedly, the possibility of a global recession could be a major concern as advertising is a valuable cyclical industry.

However, the economic environment has been challenging and WPP has shown remarkable resilience. In that context, the risk/reward profile looks good to me. If I had the money, I would invest in the company now.