“When we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever.”
— Warren Buffett
The Warren Buffett investment philosophy calls for a long-term investment horizon, where a twenty year holding period, or even longer, would fit right into the strategy. How would such a strategy have worked out for an investment into ABIOMED, Inc. (NASD: ABMD)? Today, we examine the outcome of a twenty year investment into the stock back in 1999.
| Start date: | 09/27/1999 |
|
|||
| End date: | 09/26/2019 | ||||
| Start price/share: | $7.44 | ||||
| End price/share: | $177.65 | ||||
| Starting shares: | 1,344.09 | ||||
| Ending shares: | 1,344.09 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | 2,287.77% | ||||
| Average annual return: | 17.18% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $238,684.62 | ||||
The above analysis shows the twenty year investment result worked out exceptionally well, with an annualized rate of return of 17.18%. This would have turned a $10K investment made 20 years ago into $238,684.62 today (as of 09/26/2019). On a total return basis, that’s a result of 2,287.77% (something to think about: how might ABMD shares perform over the next 20 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
One more piece of investment wisdom to leave you with:
“Don’t wait for the perfect time, you will wait forever. Always take advantage of the time you’re given and make it perfect.” — Daymond John
