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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 twenty year period?

Today, let’s look backwards in time to 2001, and take a look at what happened to investors who asked that very question about Fiserv Inc (NASD: FISV), by taking a look at the investment outcome over a twenty year holding period.

Start date: 02/02/2001


End date: 02/01/2021
Start price/share: $8.47
End price/share: $106.50
Starting shares: 1,180.64
Ending shares: 1,180.64
Dividends reinvested/share: $0.00
Total return: 1,157.38%
Average annual return: 13.49%
Starting investment: $10,000.00
Ending investment: $125,821.31

As shown above, the twenty year investment result worked out quite well, with an annualized rate of return of 13.49%. This would have turned a $10K investment made 20 years ago into $125,821.31 today (as of 02/01/2021). On a total return basis, that’s a result of 1,157.38% (something to think about: how might FISV 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 four most dangerous words in investing are: ‘this time it’s different.'” — Sir John Templeton