“When we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever.”
— Warren Buffett
The above quote from Warren Buffett is timeless, and brings into focus the choice about time horizon that any investor should think about before buying a stock they are considering. Behind every stock is an actual business; what will that business look like over a two-decade period?
Today, let’s look backwards in time to 2000, and take a look at what happened to investors who asked that very question about Hologic Inc (NASD: HOLX), by taking a look at the investment outcome over a two-decade holding period.
|Average annual return:||15.16%|
As we can see, the two-decade investment result worked out exceptionally well, with an annualized rate of return of 15.16%. This would have turned a $10K investment made 20 years ago into $168,475.59 today (as of 04/01/2020). On a total return basis, that’s a result of 1,585.57% (something to think about: how might HOLX 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:
“All the opportunity in the world means nothing if you don’t actually pull the trigger.” — Sam Zell