“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 Netflix Inc (NASD: NFLX)? Today, we examine the outcome of a twenty year investment into the stock back in 2005.
| Start date: | 06/27/2005 |
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| End date: | 06/26/2025 | ||||
| Start price/share: | $2.28 | ||||
| End price/share: | $1,306.67 | ||||
| Starting shares: | 4,385.96 | ||||
| Ending shares: | 4,385.96 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | 57,210.09% | ||||
| Average annual return: | 37.35% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $5,729,064.69 | ||||
As shown above, the twenty year investment result worked out exceptionally well, with an annualized rate of return of 37.35%. This would have turned a $10K investment made 20 years ago into $5,729,064.69 today (as of 06/26/2025). On a total return basis, that’s a result of 57,210.09% (something to think about: how might NFLX shares perform over the next 20 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Another great investment quote to think about:
“Sometimes buying early on the way down looks like being wrong, but it isn’t.” — Seth Klarman
