“I buy on the assumption that they could close the market the next day and not reopen it for five years.”
— Warren Buffett
The Warren Buffett investment philosophy calls for a long-term investment horizon, where a five year holding period, or even longer, would fit right into the strategy. How would such a strategy have worked out for an investment into Adobe Inc (NASD: ADBE)? Today, we examine the outcome of a five year investment into the stock back in 2014.
| Start date: | 10/07/2014 |
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| End date: | 10/04/2019 | ||||
| Start price/share: | $65.96 | ||||
| End price/share: | $276.96 | ||||
| Starting shares: | 151.61 | ||||
| Ending shares: | 151.61 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | 319.89% | ||||
| Average annual return: | 33.28% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $41,989.56 | ||||
The above analysis shows the five year investment result worked out exceptionally well, with an annualized rate of return of 33.28%. This would have turned a $10K investment made 5 years ago into $41,989.56 today (as of 10/04/2019). On a total return basis, that’s a result of 319.89% (something to think about: how might ADBE shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
More investment wisdom to ponder:
“The stock market is filled with individuals who know the price of everything, but the value of nothing.” — Phillip Fisher
