3 Dividend Kings That Should Help You Pull Through Inflation in 2022

Dividend Kings, which are companies that have raised their dividends for at least 50 consecutive years, are some of the most reliable passive income stocks that you will come across. These companies have managed to continue raising their dividends through several market crashes and bear markets, from Black Monday in 1987 through the COVID-19 pandemic now. The three Dividend Kings I will talk about below are also banks and insurance companies, which tend to be good hedges against inflation.

With nearly $30 billion in assets, Cincinnati Financial Corporation (NASDAQ: CINF) is mainly a property and casualty insurer that does business in 45 U.S. states as well as some business in London. More than $23 billion of Cincinnati Financial's assets are invested in fixed maturity investments and equity securities. Cincinnati's equities portfolio is impacted by changes in market prices and the company's largest equity holding is Apple, so a higher-rate environment may not be so great for some stocks in the portfolio.

But the equities portfolio is also concentrated with sectors that hedge inflation better, like financials and energy. Also, as management noted in the company's recent regulatory filing, a 1% instantaneous move in short- and long-term interest rates would grow the fair value of the company's fixed-maturity portfolio by nearly 5%, and enable the company to invest cash flow in securities with higher yields. Cincinnati Financial has now raised its dividend for 61 straight years and has a respectable dividend yield of 2.2%.

Source Fool.com