Photo credit: commons.wikimedia.org

“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 Warner Bros Discovery Inc (NASD: WBD)? Today, we examine the outcome of a five year investment into the stock back in 2018.

Start date: 05/03/2018
$10,000

05/03/2018
  $5,549

05/02/2023
End date: 05/02/2023
Start price/share: $22.87
End price/share: $12.69
Starting shares: 437.25
Ending shares: 437.25
Dividends reinvested/share: $0.00
Total return: -44.51%
Average annual return: -11.11%
Starting investment: $10,000.00
Ending investment: $5,549.64

The above analysis shows the five year investment result worked out poorly, with an annualized rate of return of -11.11%. This would have turned a $10K investment made 5 years ago into $5,549.64 today (as of 05/02/2023). On a total return basis, that’s a result of -44.51% (something to think about: how might WBD shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

Here’s one more great investment quote before you go:
“Our job is to find a few intelligent things to do, not to keep up with every damn thing in the world.” — Charlie Munger