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“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.

Start date: 04/12/2001


End date: 04/09/2021
Start price/share: $6.42
End price/share: $117.55
Starting shares: 1,557.63
Ending shares: 1,557.63
Dividends reinvested/share: $0.00
Total return: 1,731.00%
Average annual return: 15.64%
Starting investment: $10,000.00
Ending investment: $183,023.75

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