“I buy on the assumption that they could close the market the next day and not reopen it for five 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 five year period?
Today, let’s look backwards in time to 2016, and take a look at what happened to investors who asked that very question about Autodesk Inc (NASD: ADSK), by taking a look at the investment outcome over a five year holding period.
|Average annual return:||33.58%|
The above analysis shows the five year investment result worked out exceptionally well, with an annualized rate of return of 33.58%. This would have turned a $10K investment made 5 years ago into $42,531.16 today (as of 11/16/2021). On a total return basis, that’s a result of 325.24% (something to think about: how might ADSK shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
More investment wisdom to ponder:
“Waiting helps you as an investor and a lot of people just can’t stand to wait. If you didn’t get the deferred-gratification gene, you’ve got to work very hard to overcome that.” — Charlie Munger