“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 Salesforce.com Inc (NYSE: CRM)? Today, we examine the outcome of a five year investment into the stock back in 2016.
| Start date: | 05/03/2016 |
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| End date: | 04/30/2021 | ||||
| Start price/share: | $74.90 | ||||
| End price/share: | $230.32 | ||||
| Starting shares: | 133.51 | ||||
| Ending shares: | 133.51 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | 207.50% | ||||
| Average annual return: | 25.22% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $30,749.16 | ||||
The above analysis shows the five year investment result worked out exceptionally well, with an annualized rate of return of 25.22%. This would have turned a $10K investment made 5 years ago into $30,749.16 today (as of 04/30/2021). On a total return basis, that’s a result of 207.50% (something to think about: how might CRM shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Another great investment quote to think about:
“It is remarkable how much long-term advantage people like us have gotten by trying to be consistently not stupid, instead of trying to be very intelligent.” — Charlie Munger
