“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 two-decade 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 two-decade investment into the stock back in 2005.
| Start date: | 04/18/2005 |
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| End date: | 04/15/2025 | ||||
| Start price/share: | $39.85 | ||||
| End price/share: | $32.67 | ||||
| Starting shares: | 250.94 | ||||
| Ending shares: | 387.46 | ||||
| Dividends reinvested/share: | $23.87 | ||||
| Total return: | 26.58% | ||||
| Average annual return: | 1.19% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $12,670.10 | ||||
As shown above, the two-decade investment result worked out as follows, with an annualized rate of return of 1.19%. This would have turned a $10K investment made 20 years ago into $12,670.10 today (as of 04/15/2025). On a total return basis, that’s a result of 26.58% (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 3.06%. 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 $39.85/share purchase price. This works out to a yield on cost of 7.68%.
Another great investment quote to think about:
“It’s not whether you’re right or wrong that’s important, but how much money you make when you’re right and how much you lose when you’re wrong.” — George Soros
