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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 2017, and take a look at what happened to investors who asked that very question about Hologic Inc (NASD: HOLX), by taking a look at the investment outcome over a five year holding period.

Start date: 01/06/2017


End date: 01/05/2022
Start price/share: $39.88
End price/share: $70.76
Starting shares: 250.75
Ending shares: 250.75
Dividends reinvested/share: $0.00
Total return: 77.43%
Average annual return: 12.15%
Starting investment: $10,000.00
Ending investment: $17,741.75

As shown above, the five year investment result worked out quite well, with an annualized rate of return of 12.15%. This would have turned a $10K investment made 5 years ago into $17,741.75 today (as of 01/05/2022). On a total return basis, that’s a result of 77.43% (something to think about: how might HOLX 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:
“The policy of being too cautious is the greatest risk of all.” — Jawaharlal Nehru