“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 The Cigna Group (NYSE: CI)? Today, we examine the outcome of a decade-long investment into the stock back in 2015.
| Start date: | 05/18/2015 |
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| End date: | 05/15/2025 | ||||
| Start price/share: | $133.27 | ||||
| End price/share: | $308.86 | ||||
| Starting shares: | 75.04 | ||||
| Ending shares: | 80.87 | ||||
| Dividends reinvested/share: | $20.71 | ||||
| Total return: | 149.76% | ||||
| Average annual return: | 9.59% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $24,986.72 | ||||
As we can see, the decade-long investment result worked out well, with an annualized rate of return of 9.59%. This would have turned a $10K investment made 10 years ago into $24,986.72 today (as of 05/15/2025). On a total return basis, that’s a result of 149.76% (something to think about: how might CI shares perform over the next 10 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Notice that The Cigna Group paid investors a total of $20.71/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 6.04/share, we calculate that CI has a current yield of approximately 1.96%. Another interesting datapoint we can examine is ‘yield on cost’ — in other words, we can express the current annualized dividend of 6.04 against the original $133.27/share purchase price. This works out to a yield on cost of 1.47%.
One more piece of investment wisdom to leave you with:
“Unless you can watch your stock holding decline by 50% without becoming panic-stricken, you should not be in the stock market.” — Warren Buffett
