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“Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years.”

— Warren Buffett

The Warren Buffett investment philosophy calls for a long-term investment horizon, where a decade-long holding period, or even longer, would fit right into the strategy. How would such a strategy have worked out for an investment into Dominion Energy Inc (NYSE: D)? Today, we examine the outcome of a decade-long investment into the stock back in 2014.

Start date: 01/03/2014


End date: 01/02/2024
Start price/share: $63.51
End price/share: $48.51
Starting shares: 157.46
Ending shares: 236.60
Dividends reinvested/share: $29.15
Total return: 14.78%
Average annual return: 1.39%
Starting investment: $10,000.00
Ending investment: $11,480.68

As shown above, the decade-long investment result worked out as follows, with an annualized rate of return of 1.39%. This would have turned a $10K investment made 10 years ago into $11,480.68 today (as of 01/02/2024). On a total return basis, that’s a result of 14.78% (something to think about: how might D shares perform over the next 10 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

Notice that Dominion Energy Inc paid investors a total of $29.15/share in dividends over the 10 holding period, marking a second component of the total return beyond share price change alone. Much like watering a tree, reinvesting dividends can help an investment to grow over time — for the above calculations we assume dividend reinvestment (and for this exercise the closing price on ex-date is used for the reinvestment of a given dividend).

Based upon the most recent annualized dividend rate of 2.67/share, we calculate that D has a current yield of approximately 5.50%. Another interesting datapoint we can examine is ‘yield on cost’ — in other words, we can express the current annualized dividend of 2.67 against the original $63.51/share purchase price. This works out to a yield on cost of 8.66%.

Another great investment quote to think about:
“If you have more than 120 or 130 I.Q. points, you can afford to give the rest away. You don’t need extraordinary intelligence to succeed as an investor.” — Warren Buffett