“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 Halliburton Company (NYSE: HAL)? Today, we examine the outcome of a decade-long investment into the stock back in 2015.
| Start date: | 04/02/2015 |
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| End date: | 04/01/2025 | ||||
| Start price/share: | $43.96 | ||||
| End price/share: | $25.55 | ||||
| Starting shares: | 227.48 | ||||
| Ending shares: | 273.74 | ||||
| Dividends reinvested/share: | $5.89 | ||||
| Total return: | -30.06% | ||||
| Average annual return: | -3.51% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $6,994.20 | ||||
The above analysis shows the decade-long investment result worked out poorly, with an annualized rate of return of -3.51%. This would have turned a $10K investment made 10 years ago into $6,994.20 today (as of 04/01/2025). On a total return basis, that’s a result of -30.06% (something to think about: how might HAL shares perform over the next 10 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Notice that Halliburton Company paid investors a total of $5.89/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 .68/share, we calculate that HAL has a current yield of approximately 2.66%. Another interesting datapoint we can examine is ‘yield on cost’ — in other words, we can express the current annualized dividend of .68 against the original $43.96/share purchase price. This works out to a yield on cost of 6.05%.
One more piece of investment wisdom to leave you with:
“People who invest make money for themselves; people who speculate make money for their brokers.” — Benjamin Graham
