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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 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 Carmax Inc. (NYSE: KMX)? Today, we examine the outcome of a five year investment into the stock back in 2018.

Start date: 04/03/2018
$10,000

04/03/2018
  $10,719

03/31/2023
End date: 03/31/2023
Start price/share: $59.96
End price/share: $64.28
Starting shares: 166.78
Ending shares: 166.78
Dividends reinvested/share: $0.00
Total return: 7.20%
Average annual return: 1.40%
Starting investment: $10,000.00
Ending investment: $10,719.06

As we can see, the five year investment result worked out as follows, with an annualized rate of return of 1.40%. This would have turned a $10K investment made 5 years ago into $10,719.06 today (as of 03/31/2023). On a total return basis, that’s a result of 7.20% (something to think about: how might KMX 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:
“Cash combined with courage in a time of crisis is priceless.” — Warren Buffett