“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: | 08/28/2018 |
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| End date: | 08/25/2023 | ||||
| Start price/share: | $28.29 | ||||
| End price/share: | $12.27 | ||||
| Starting shares: | 353.48 | ||||
| Ending shares: | 353.48 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | -56.63% | ||||
| Average annual return: | -15.40% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $4,337.60 | ||||
As we can see, the five year investment result worked out poorly, with an annualized rate of return of -15.40%. This would have turned a $10K investment made 5 years ago into $4,337.60 today (as of 08/25/2023). On a total return basis, that’s a result of -56.63% (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:
“Waiting helps you as an investor and a lot of people just can’t stand to wait. If you didn’t get the deferred-gratification gene, you’ve got to work very hard to overcome that.” — Charlie Munger
