3 dirt cheap dividend shares to buy today

Everywhere I look, I see low dividend stocks. I don’t mean only high dividends, because they can be the first thing when times are difficult.

No, I mean the shares pay a decent dividend, but they also look cheap in other valuation measures.

My most recent vote is at least on FTSE 100, where our favorite dividend stocks are usually found. Today, I’m looking at three smaller ones that I think might be cheap.

health real estate

Target Healthcare REIT Shares (LSE: THRL ) are down 35% over five years, the most in the past 12 months.

It is a real estate investment trust (REIT), and invests in rental care homes. And anything related to the current property market is poison.

It has a 9% dividend yield, which looks pretty good. Falling property values ​​have pushed stock prices down. But the stock has fallen more than the property.

The target stock is currently trading at a substantial 29% discount to its asset value. That’s like buying pound coins for 71p each.

A price-to-earnings (P/E) estimate of 30 times this year is the only real downside I see. That is perhaps a bit steep. And that could mean further share price weakness.

But the high yields and big discounts make Target look like a cheap income buy to me.

Builder

I mentioned housebuilders. And I can’t look for a low dividend stock without finding one. That Vistry (LSE: VTY), formerly known as Bovis Homes.

We see another drop in stock prices at the end of 2022, dropping by a third in five years.

Interest rates are high, mortgages are expensive, and people are struggling to afford a home. I don’t deny businesses are under pressure, and 2023 certainly looks like a risky year.

So what about basic assessment measures? Dividend yield above 8%, although the forecast should drop to 6%. But the predicted P/E is at nine, which is lower than the market average.

Whatever happens in 2023, I just see it being cheap for a company with healthy long-term cash and dividend prospects.

Bank

It is easy to overlook the so-called challenger banks, for example Virgin Money UK (LSE: VMUK). Its shares are more stable than those of the big UK banks. And they fell sharply in response to the latest banking crisis in the US. Virgin has underperformed over five years, down nearly 60%.

The small size of the bank should make it a safer investment. A market capitalization of £1.9bn is tiny compared to, say, Barclays at £22bn.

In the recent financial crisis, banks with less capital and liquidity are always more likely to go to the wall.

But we see a P/E of less than seven here, it is expected to fall below five in the next three years. And we have a dividend yield of up to 8% over the same period.

There is a risk, but this is another one that I rate as cheap.