“I buy on the assumption that they could close the market the next day and not reopen it for five years.”
— Warren Buffett
The Warren Buffett investment philosophy calls for a long-term investment horizon, where a five year holding period, or even longer, would fit right into the strategy. How would such a strategy have worked out for an investment into Netflix Inc (NASD: NFLX)? Today, we examine the outcome of a five year investment into the stock back in 2017.
| Start date: | 03/28/2017 |
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| End date: | 03/25/2022 | ||||
| Start price/share: | $145.17 | ||||
| End price/share: | $373.85 | ||||
| Starting shares: | 68.88 | ||||
| Ending shares: | 68.88 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | 157.53% | ||||
| Average annual return: | 20.85% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $25,750.32 | ||||
As shown above, the five year investment result worked out exceptionally well, with an annualized rate of return of 20.85%. This would have turned a $10K investment made 5 years ago into $25,750.32 today (as of 03/25/2022). On a total return basis, that’s a result of 157.53% (something to think about: how might NFLX shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
One more investment quote to leave you with:
“When you sell in desperation, you always sell cheap.” — Peter Lynch
