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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 2018, and take a look at what happened to investors who asked that very question about Dollar Tree Inc (NASD: DLTR), by taking a look at the investment outcome over a five year holding period.

Start date: 01/03/2018


End date: 12/30/2022
Start price/share: $108.02
End price/share: $141.44
Starting shares: 92.58
Ending shares: 92.58
Dividends reinvested/share: $0.00
Total return: 30.94%
Average annual return: 5.55%
Starting investment: $10,000.00
Ending investment: $13,094.79

The above analysis shows the five year investment result worked out well, with an annualized rate of return of 5.55%. This would have turned a $10K investment made 5 years ago into $13,094.79 today (as of 12/30/2022). On a total return basis, that’s a result of 30.94% (something to think about: how might DLTR shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

More investment wisdom to ponder:
“Every once in a while, the market does something so stupid it takes your breath away.” — Jim Cramer