“I buy on the assumption that they could close the market the next day and not reopen it for five 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 five year period?
Today, let’s look backwards in time to 2021, and take a look at what happened to investors who asked that very question about C.H. Robinson Worldwide, Inc. (NASD: CHRW), by taking a look at the investment outcome over a five year holding period.
| Start date: | 02/12/2021 |
|
|||
| End date: | 02/11/2026 | ||||
| Start price/share: | $91.30 | ||||
| End price/share: | $196.33 | ||||
| Starting shares: | 109.53 | ||||
| Ending shares: | 123.27 | ||||
| Dividends reinvested/share: | $11.73 | ||||
| Total return: | 142.02% | ||||
| Average annual return: | 19.34% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $24,206.40 | ||||
As we can see, the five year investment result worked out exceptionally well, with an annualized rate of return of 19.34%. This would have turned a $10K investment made 5 years ago into $24,206.40 today (as of 02/11/2026). On a total return basis, that’s a result of 142.02% (something to think about: how might CHRW shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Notice that C.H. Robinson Worldwide, Inc. paid investors a total of $11.73/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 2.52/share, we calculate that CHRW has a current yield of approximately 1.28%. Another interesting datapoint we can examine is ‘yield on cost’ — in other words, we can express the current annualized dividend of 2.52 against the original $91.30/share purchase price. This works out to a yield on cost of 1.40%.
More investment wisdom to ponder:
“In the long run, we are all dead.” — John Maynard Keynes
