Dividend Growth Is a “Great Offense” Against Inflation

August 26, 2026
Schwab Network

David Bahnsen, CIO of The Bahnsen Group and author of Profit from the Profit: The Past, Present, and Future of Dividend Growth Investing, explains why dividend growth can help inflation-proof portfolios, arguing that rising prices flow through to company revenues and dividend payments and that dividend growth has historically averaged about 6–9% annually, often outpacing inflation despite stock price volatility. He pushes back on the idea that dividend stocks are boring, citing long-term compounding and lower volatility versus the broader S&P, and contrasts dividend-growing equities with bonds, which lack principal growth. Bahnsen discusses McDonald’s, PepsiCo (as a value opportunity with a long dividend growth record), and Verizon (improving returns on past 5G CapEx). He also cautions against buying “hot” Mag Seven/AI names like Nvidia due to valuation and risk/reward concerns.