“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 Live Nation Entertainment Inc (NYSE: LYV), by taking a look at the investment outcome over a decade-long holding period.
| Start date: | 05/16/2013 |
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| End date: | 05/15/2023 | ||||
| Start price/share: | $13.69 | ||||
| End price/share: | $80.39 | ||||
| Starting shares: | 730.46 | ||||
| Ending shares: | 730.46 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | 487.22% | ||||
| Average annual return: | 19.36% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $58,721.71 | ||||
As we can see, the decade-long investment result worked out exceptionally well, with an annualized rate of return of 19.36%. This would have turned a $10K investment made 10 years ago into $58,721.71 today (as of 05/15/2023). On a total return basis, that’s a result of 487.22% (something to think about: how might LYV shares perform over the next 10 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Another great investment quote to think about:
“The whole secret to winning big in the stock market is not to be right all the time, but to lose the least amount possible when you’re wrong.” — William O’Neil
