“Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years.”
— Warren Buffett
The above quote from Warren Buffett is timeless, and brings into focus the choice about time horizon that any investor should think about before buying a stock they are considering. Behind every stock is an actual business; what will that business look like over a ten year period?
Today, let’s look backwards in time to 2015, and take a look at what happened to investors who asked that very question about Keurig Dr Pepper Inc (NASD: KDP), by taking a look at the investment outcome over a ten year holding period.
| Start date: | 12/23/2015 |
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| End date: | 12/22/2025 | ||||
| Start price/share: | $93.85 | ||||
| End price/share: | $28.24 | ||||
| Starting shares: | 106.55 | ||||
| Ending shares: | 757.43 | ||||
| Dividends reinvested/share: | $114.17 | ||||
| Total return: | 113.90% | ||||
| Average annual return: | 7.90% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $21,399.09 | ||||
The above analysis shows the ten year investment result worked out well, with an annualized rate of return of 7.90%. This would have turned a $10K investment made 10 years ago into $21,399.09 today (as of 12/22/2025). On a total return basis, that’s a result of 113.90% (something to think about: how might KDP shares perform over the next 10 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Notice that Keurig Dr Pepper Inc paid investors a total of $114.17/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 .92/share, we calculate that KDP has a current yield of approximately 3.26%. Another interesting datapoint we can examine is ‘yield on cost’ — in other words, we can express the current annualized dividend of .92 against the original $93.85/share purchase price. This works out to a yield on cost of 3.47%.
Another great investment quote to think about:
“Although it’s easy to forget sometimes, a share is not a lottery ticket… it’s part-ownership of a business.” — Peter Lynch
