“I buy on the assumption that they could close the market the next day and not reopen it for five years.”
— Warren Buffett
The Warren Buffett investment philosophy calls for a long-term investment horizon, where a five year holding period, or even longer, would fit right into the strategy. How would such a strategy have worked out for an investment into Juniper Networks Inc (NYSE: JNPR)? Today, we examine the outcome of a five year investment into the stock back in 2020.
| Start date: | 07/01/2020 |
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| End date: | 06/30/2025 | ||||
| Start price/share: | $22.55 | ||||
| End price/share: | $39.93 | ||||
| Starting shares: | 443.46 | ||||
| Ending shares: | 509.53 | ||||
| Dividends reinvested/share: | $4.24 | ||||
| Total return: | 103.45% | ||||
| Average annual return: | 15.26% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $20,341.97 | ||||
As shown above, the five year investment result worked out exceptionally well, with an annualized rate of return of 15.26%. This would have turned a $10K investment made 5 years ago into $20,341.97 today (as of 06/30/2025). On a total return basis, that’s a result of 103.45% (something to think about: how might JNPR shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Notice that Juniper Networks Inc paid investors a total of $4.24/share in dividends over the 5 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 .88/share, we calculate that JNPR has a current yield of approximately 2.20%. Another interesting datapoint we can examine is ‘yield on cost’ — in other words, we can express the current annualized dividend of .88 against the original $22.55/share purchase price. This works out to a yield on cost of 9.76%.
More investment wisdom to ponder:
“Know what you own and why you own it.” — Peter Lynch
