2 cheap FTSE 100 dividend stocks I’d buy after last week’s fiasco!

UK stocks have been sold off sharply as fears about the US economy have grown. But I’m not running for the hills. In fact, I’m looking for the best dividend stocks to buy at discounted prices.

I’ve been investing long enough to know that volatility is an inherent part of stock investing. I also know that over time, the stock market always recovers, and those who buy when prices are down have the opportunity to maximize their profits over the long term.

Unfortunately, I don’t have any spare cash in my investment account to make the most of last week’s market decline. If I did, here are two FTSE100 dividend stock opportunities I would buy today.

Aviva

When the US economy catches a cold, the whole world sneezes, as the saying goes. But I believe that a fresh decline Aviva (LSE:AV.) make the company, which operates in the UK, Ireland and Canada, an even more attractive buy.

The Footsie stock now trades on a price-to-earnings (P/E) ratio of 10.5. And its dividend yield is 7.4%, more than twice the index average.

Despite the threat of contagion in the US, I think things are starting to improve for the financial services giant. Last week’s rate cuts are likely to boost demand for its life insurance, pensions and other discretionary products. And more cuts from the Bank of England could come soon.

Aviva’s large general insurance operations should continue to offset weakness in other areas of the business. While this weakness remains a concern, spending on home, auto, pet and other policies remains largely solid at all points in the economic cycle.

That means Aviva should continue to enjoy strong cash flow as premiums continue to flow in, giving it the strength to continue paying market-beating dividends. Encouragingly, it is already sitting on a huge pile of excess cash, with its Solvency II ratio standing at 206% in March.

The Aviva share price is up 26% in the past year. I expect it to rebound sharply from last week’s fall.

Phoenix Group

I would also like to open a position in Phoenix Group Holdings (LSE:PHNX) if I had spare cash to invest today.

The market’s fall last week leaves the Footsie firm with a 10.2% expected dividend yield, one of the highest on the index. Meanwhile, a price-to-earnings growth (PEG) ratio of 0.3 suggests it’s also very cheap, based on expected earnings.

Any reading below 1 means the stock is undervalued. Incidentally, Aviva’s stock reading is 0.5.

The beauty of both of these stocks is that their markets are growing rapidly. Intense competition remains a threat. However, they have the opportunity to deliver impressive long-term earnings growth. As a result, this could translate into steadily increasing dividends over the long term.

Speaking of which, City analysts expect dividends on Aviva and Phoenix shares to continue to grow until at least 2026. The latter’s Solvency II ratio of 176% in December also puts it in a strong position to deliver on those sunny forecasts.