“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 2001, and take a look at what happened to investors who asked that very question about Dollar Tree Inc (NASD: DLTR), by taking a look at the investment outcome over a two-decade holding period.
|Average annual return:||15.64%|
The above analysis shows the two-decade investment result worked out exceptionally well, with an annualized rate of return of 15.64%. This would have turned a $10K investment made 20 years ago into $183,023.75 today (as of 04/09/2021). On a total return basis, that’s a result of 1,731.00% (something to think about: how might DLTR shares perform over the next 20 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
More investment wisdom to ponder:
“You can’t restate a dividend.” — Malon Wilkus