There are a great deal of extremely low-cost shares on the FTSE 100 right this moment, and plenty of provide improbable charges of dividend revenue. I believe now might show a superb time to purchase them.

Sooner or later, rates of interest might fall appreciably. When this occurs, yields on lower-risk investments like money and bonds will decline, making dividend-paying shares extra engaging.

FTSE 100 revenue shares have been out of favour for years, as buyers throw cash at US tech. Nonetheless, the rise of Chinese language AI participant DeepSeek might cool enthusiasm for the associated US mega-caps, probably main buyers again to old-school worth shares.

At present’s decrease UK share costs imply greater dividend yields for brand new buyers, and reinvesting dividends right this moment can construct my stake for the day when revenue shares rebound.

With this in thoughts, listed below are three high-yield dividend shares I believe look significantly engaging proper now.

I’m sorely tempted by Shell

Oil large Shell (LSE: SHEL) has had a stable 12 months, its share price climbing 6% over the previous 12 months. 

Regardless of this, it stays attractively valued, with a low price-to-earnings (P/E) ratio of simply 7.6. Traders are additionally rewarded with a good 4% trailing dividend yield.

Shell’s robust monetary place and vital money circulate technology ought to assist fund its dividend and share buybacks. The largest danger is oil price volatility. It’s simply not possible to say the place costs will go. The corporate additionally faces the problem of balancing profitability from fossil fuels whereas investing in renewables and low-carbon vitality options.

However long-term, I consider Shell stays engaging for buyers searching for each dividend revenue and share price development. With its dedication to returning capital to shareholders, it’s well-positioned to reward affected person buyers.

Rio Tinto appears to be like good worth

Mining large Rio Tinto‘s (LSE: RIO) struggled, with the share price dropping 13% over the previous 12 months. 

Nonetheless, this has pushed its dividend up to a formidable 7.3%, making it one of many highest yielders on the FTSE 100. Its low P/E ratio of 8.3 suggests it’s undervalued.

Rio Tinto’s been hit laborious by the Chinese language financial slowdown, which has dampened demand for metals and minerals. The China development story could also be over for good however Rio Tinto might profit from the shift in the direction of renewable vitality and electrical autos (EVs), which require industrial metals together with copper and aluminium.

Mining’s cyclical, however downturns current shopping for alternatives. With its robust stability sheet and disciplined method to capital allocation, Rio Tinto appears to be like well-positioned to profit when demand recovers.

If solely I might purchase British American Tobacco

British American Tobacco‘s (LSE: BATS) surged 36% up to now 12 months, but nonetheless affords a excessive dividend yield of seven.4% and trades at a low P/E of simply 8.4.

Whereas smoking’s declining within the West, the corporate has diversified into next-generation merchandise together with vapes and heated tobacco.

Regulatory dangers stay, as governments might tighten restrictions on new nicotine merchandise. Nonetheless, British American Tobacco sells billions of ‘sticks’ yearly and continues to generate robust money flows, supporting its beneficiant dividends.

Regardless of moral considerations, buyers searching for dependable revenue might discover it engaging. Personally, I don’t spend money on tobacco shares, in any other case I’d have purchased this one years in the past and could be considerably wealthier. 

However I’m now contemplating shopping for Shell to complement my holding in rival BP, whereas Rio Tinto’s excessive on my purchasing record.