“Only buy something that you’d be perfectly happy to hold if the market shut down for 10 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 decade-long period?
Today, let’s look backwards in time to 2013, and take a look at what happened to investors who asked that very question about Meta Platforms Inc (NASD: META), by taking a look at the investment outcome over a decade-long holding period.
| Start date: | 03/18/2013 |
|
|||
| End date: | 03/16/2023 | ||||
| Start price/share: | $26.49 | ||||
| End price/share: | $204.93 | ||||
| Starting shares: | 377.50 | ||||
| Ending shares: | 377.50 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | 673.61% | ||||
| Average annual return: | 22.70% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $77,347.38 | ||||
As we can see, the decade-long investment result worked out exceptionally well, with an annualized rate of return of 22.70%. This would have turned a $10K investment made 10 years ago into $77,347.38 today (as of 03/16/2023). On a total return basis, that’s a result of 673.61% (something to think about: how might META shares perform over the next 10 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
One more piece of investment wisdom to leave you with:
“The stock market is filled with individuals who know the price of everything, but the value of nothing.” — Phillip Fisher
