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“Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years.”

— Warren Buffett

The Warren Buffett investment philosophy calls for a long-term investment horizon, where a ten year holding period, or even longer, would fit right into the strategy. How would such a strategy have worked out for an investment into Molson Coors Beverage Co (NYSE: TAP)? Today, we examine the outcome of a ten year investment into the stock back in 2012.

Start date: 02/16/2012


End date: 02/15/2022
Start price/share: $45.10
End price/share: $49.52
Starting shares: 221.73
Ending shares: 276.86
Dividends reinvested/share: $13.81
Total return: 37.10%
Average annual return: 3.20%
Starting investment: $10,000.00
Ending investment: $13,704.78

As shown above, the ten year investment result worked out as follows, with an annualized rate of return of 3.20%. This would have turned a $10K investment made 10 years ago into $13,704.78 today (as of 02/15/2022). On a total return basis, that’s a result of 37.10% (something to think about: how might TAP shares perform over the next 10 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

Notice that Molson Coors Beverage Co paid investors a total of $13.81/share in dividends over the 10 holding period, marking a second component of the total return beyond share price change alone. Much like watering a tree, reinvesting dividends can help an investment to grow over time — for the above calculations we assume dividend reinvestment (and for this exercise the closing price on ex-date is used for the reinvestment of a given dividend).

Based upon the most recent annualized dividend rate of 1.36/share, we calculate that TAP has a current yield of approximately 2.75%. Another interesting datapoint we can examine is ‘yield on cost’ — in other words, we can express the current annualized dividend of 1.36 against the original $45.10/share purchase price. This works out to a yield on cost of 6.10%.

More investment wisdom to ponder:
“If you don’t study any companies, you have the same success buying stocks as you do in a poker game if you bet without looking at your cards.” — Peter Lynch