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“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 Fiserv Inc (NASD: FISV), by taking a look at the investment outcome over a five year holding period.

Start date: 12/08/2016


End date: 12/07/2021
Start price/share: $52.36
End price/share: $103.13
Starting shares: 190.99
Ending shares: 190.99
Dividends reinvested/share: $0.00
Total return: 96.96%
Average annual return: 14.52%
Starting investment: $10,000.00
Ending investment: $19,697.30

The above analysis shows the five year investment result worked out quite well, with an annualized rate of return of 14.52%. This would have turned a $10K investment made 5 years ago into $19,697.30 today (as of 12/07/2021). On a total return basis, that’s a result of 96.96% (something to think about: how might FISV shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

One more piece of investment wisdom to leave you with:
“Every day that you’re not selling an asset in your portfolio, you’re choosing to buy it.” — Sam Zell