“Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years.”
— 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 ten year period?
Today, let’s look backwards in time to 2011, and take a look at what happened to investors who asked that very question about United Rentals Inc (NYSE: URI), by taking a look at the investment outcome over a ten year holding period.
|Average annual return:||35.43%|
As we can see, the ten year investment result worked out exceptionally well, with an annualized rate of return of 35.43%. This would have turned a $10K investment made 10 years ago into $207,562.45 today (as of 08/12/2021). On a total return basis, that’s a result of 1,975.47% (something to think about: how might URI shares perform over the next 10 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Here’s one more great investment quote before you go:
“If you can follow only one bit of data, follow the earnings.” — Peter Lynch