“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: | 06/06/2018 |
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| End date: | 06/05/2023 | ||||
| Start price/share: | $22.36 | ||||
| End price/share: | $11.63 | ||||
| Starting shares: | 447.23 | ||||
| Ending shares: | 447.23 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | -47.99% | ||||
| Average annual return: | -12.26% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $5,199.82 | ||||
As we can see, the five year investment result worked out poorly, with an annualized rate of return of -12.26%. This would have turned a $10K investment made 5 years ago into $5,199.82 today (as of 06/05/2023). On a total return basis, that’s a result of -47.99% (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:
“I think you have to learn that there’s a company behind every stock, and that there’s only one real reason why stocks go up. Companies go from doing poorly to doing well or small companies grow to large companies.” — Peter Lynch
