“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 Broadcom Inc (NASD: AVGO)? Today, we examine the outcome of a decade-long investment into the stock back in 2015.
| Start date: | 07/21/2015 |
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| End date: | 07/18/2025 | ||||
| Start price/share: | $13.45 | ||||
| End price/share: | $283.34 | ||||
| Starting shares: | 743.49 | ||||
| Ending shares: | 974.97 | ||||
| Dividends reinvested/share: | $12.85 | ||||
| Total return: | 2,662.47% | ||||
| Average annual return: | 39.36% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $276,300.31 | ||||
As we can see, the decade-long investment result worked out exceptionally well, with an annualized rate of return of 39.36%. This would have turned a $10K investment made 10 years ago into $276,300.31 today (as of 07/18/2025). On a total return basis, that’s a result of 2,662.47% (something to think about: how might AVGO shares perform over the next 10 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Notice that Broadcom Inc paid investors a total of $12.85/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 2.36/share, we calculate that AVGO has a current yield of approximately 0.83%. Another interesting datapoint we can examine is ‘yield on cost’ — in other words, we can express the current annualized dividend of 2.36 against the original $13.45/share purchase price. This works out to a yield on cost of 6.17%.
One more investment quote to leave you with:
“History provides a crucial insight regarding market crises: they are inevitable, painful and ultimately surmountable.” — Shelby Davis
