“Someone’s sitting in the shade today because someone planted a tree a long time ago.”
— Warren Buffett
The Warren Buffett investment philosophy calls for a long-term investment horizon, where a twenty year holding period, or even longer, would fit right into the strategy. How would such a strategy have worked out for an investment into Las Vegas Sands Corp (NYSE: LVS)? Today, we examine the outcome of a twenty year investment into the stock back in 2005.
| Start date: | 03/11/2005 |
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| End date: | 03/10/2025 | ||||
| Start price/share: | $45.99 | ||||
| End price/share: | $45.34 | ||||
| Starting shares: | 217.44 | ||||
| Ending shares: | 335.73 | ||||
| Dividends reinvested/share: | $23.87 | ||||
| Total return: | 52.22% | ||||
| Average annual return: | 2.12% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $15,215.67 | ||||
As shown above, the twenty year investment result worked out as follows, with an annualized rate of return of 2.12%. This would have turned a $10K investment made 20 years ago into $15,215.67 today (as of 03/10/2025). On a total return basis, that’s a result of 52.22% (something to think about: how might LVS shares perform over the next 20 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Notice that Las Vegas Sands Corp paid investors a total of $23.87/share in dividends over the 20 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 1/share, we calculate that LVS has a current yield of approximately 2.21%. Another interesting datapoint we can examine is ‘yield on cost’ — in other words, we can express the current annualized dividend of 1 against the original $45.99/share purchase price. This works out to a yield on cost of 4.81%.
Another great investment quote to think about:
“There is nothing riskier than the widespread perception that there is no risk.” — Howard Marks
