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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 Monster Beverage Corp (NASD: MNST), by taking a look at the investment outcome over a five year holding period.

Start date: 01/13/2017
$10,000

01/13/2017
$21,112

01/12/2022
End date: 01/12/2022
Start price/share: $44.51
End price/share: $93.98
Starting shares: 224.67
Ending shares: 224.67
Dividends reinvested/share: $0.00
Total return: 111.14%
Average annual return: 16.12%
Starting investment: $10,000.00
Ending investment: $21,112.28

The above analysis shows the five year investment result worked out exceptionally well, with an annualized rate of return of 16.12%. This would have turned a $10K investment made 5 years ago into $21,112.28 today (as of 01/12/2022). On a total return basis, that’s a result of 111.14% (something to think about: how might MNST 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:
“Every once in a while, the market does something so stupid it takes your breath away.” — Jim Cramer