“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 DexCom Inc (NASD: DXCM)? Today, we examine the outcome of a five year investment into the stock back in 2015.
| Start date: | 10/21/2015 |
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| End date: | 10/20/2020 | ||||
| Start price/share: | $79.61 | ||||
| End price/share: | $392.43 | ||||
| Starting shares: | 125.61 | ||||
| Ending shares: | 125.61 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | 392.94% | ||||
| Average annual return: | 37.56% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $49,299.24 | ||||
As shown above, the five year investment result worked out exceptionally well, with an annualized rate of return of 37.56%. This would have turned a $10K investment made 5 years ago into $49,299.24 today (as of 10/20/2020). On a total return basis, that’s a result of 392.94% (something to think about: how might DXCM shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Here’s one more great investment quote before you go:
“Smart investing doesn’t consist of buying good assets but of buying assets well. This is a very, very important distinction that very, very few people understand.” — Howard Marks
