“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 Intel Corp (NASD: INTC)? Today, we examine the outcome of a two-decade investment into the stock back in 2005.
| Start date: | 11/28/2005 |
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| End date: | 11/25/2025 | ||||
| Start price/share: | $26.86 | ||||
| End price/share: | $35.83 | ||||
| Starting shares: | 372.30 | ||||
| Ending shares: | 635.83 | ||||
| Dividends reinvested/share: | $16.87 | ||||
| Total return: | 127.82% | ||||
| Average annual return: | 4.20% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $22,774.68 | ||||
The above analysis shows the two-decade investment result worked out as follows, with an annualized rate of return of 4.20%. This would have turned a $10K investment made 20 years ago into $22,774.68 today (as of 11/25/2025). On a total return basis, that’s a result of 127.82% (something to think about: how might INTC shares perform over the next 20 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Notice that Intel Corp paid investors a total of $16.87/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 .5/share, we calculate that INTC has a current yield of approximately 1.40%. Another interesting datapoint we can examine is ‘yield on cost’ — in other words, we can express the current annualized dividend of .5 against the original $26.86/share purchase price. This works out to a yield on cost of 5.21%.
Another great investment quote to think about:
“Cash combined with courage in a time of crisis is priceless.” — Warren Buffett
