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 Super Micro Computer Inc (NASD: SMCI)? Today, we examine the outcome of a five year investment into the stock back in 2019.

Start date: 09/25/2019
$10,000

09/25/2019
  $240,434

09/24/2024
End date: 09/24/2024
Start price/share: $19.28
End price/share: $463.61
Starting shares: 518.67
Ending shares: 518.67
Dividends reinvested/share: $0.00
Total return: 2,304.62%
Average annual return: 88.82%
Starting investment: $10,000.00
Ending investment: $240,434.21

The above analysis shows the five year investment result worked out exceptionally well, with an annualized rate of return of 88.82%. This would have turned a $10K investment made 5 years ago into $240,434.21 today (as of 09/24/2024). On a total return basis, that’s a result of 2,304.62% (something to think about: how might SMCI shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

More investment wisdom to ponder:
“Be fearful when others are greedy; be greedy when others are fearful.” — Warren Buffett