“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 two-decade holding period, or even longer, would fit right into the strategy. How would such a strategy have worked out for an investment into Biogen Inc (NASD: BIIB)? Today, we examine the outcome of a two-decade investment into the stock back in 1999.
| Start date: | 11/22/1999 |
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| End date: | 11/19/2019 | ||||
| Start price/share: | $134.50 | ||||
| End price/share: | $285.43 | ||||
| Starting shares: | 74.35 | ||||
| Ending shares: | 74.35 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | 112.22% | ||||
| Average annual return: | 3.83% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $21,210.29 | ||||
As we can see, the two-decade investment result worked out as follows, with an annualized rate of return of 3.83%. This would have turned a $10K investment made 20 years ago into $21,210.29 today (as of 11/19/2019). On a total return basis, that’s a result of 112.22% (something to think about: how might BIIB shares perform over the next 20 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
One more investment quote to leave you with:
“The right time for a company to finance its growth is not when it needs capital, but rather when the market is most receptive to providing capital.” — Michael Milken
