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“Someone’s sitting in the shade today because someone planted a tree a long time ago.”

— 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 DaVita Inc (NYSE: DVA), by taking a look at the investment outcome over a two-decade holding period.

Start date: 09/18/2000


End date: 09/15/2020
Start price/share: $2.27
End price/share: $89.84
Starting shares: 4,405.29
Ending shares: 4,405.29
Dividends reinvested/share: $0.00
Total return: 3,857.71%
Average annual return: 20.19%
Starting investment: $10,000.00
Ending investment: $396,099.54

The above analysis shows the two-decade investment result worked out exceptionally well, with an annualized rate of return of 20.19%. This would have turned a $10K investment made 20 years ago into $396,099.54 today (as of 09/15/2020). On a total return basis, that’s a result of 3,857.71% (something to think about: how might DVA 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:
“Cash is a fact, profit is an opinion.” — Alfred Rappaport