“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 UnitedHealth Group Inc (NYSE: UNH)? Today, we examine the outcome of a five year investment into the stock back in 2021.
| Start date: | 03/03/2021 |
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| End date: | 03/02/2026 | ||||
| Start price/share: | $332.87 | ||||
| End price/share: | $294.93 | ||||
| Starting shares: | 30.04 | ||||
| Ending shares: | 32.61 | ||||
| Dividends reinvested/share: | $36.20 | ||||
| Total return: | -3.83% | ||||
| Average annual return: | -0.78% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $9,616.04 | ||||
As shown above, the five year investment result worked out poorly, with an annualized rate of return of -0.78%. This would have turned a $10K investment made 5 years ago into $9,616.04 today (as of 03/02/2026). On a total return basis, that’s a result of -3.83% (something to think about: how might UNH shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Notice that UnitedHealth Group Inc paid investors a total of $36.20/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 8.84/share, we calculate that UNH has a current yield of approximately 3.00%. Another interesting datapoint we can examine is ‘yield on cost’ — in other words, we can express the current annualized dividend of 8.84 against the original $332.87/share purchase price. This works out to a yield on cost of 0.90%.
Here’s one more great investment quote before you go:
“A market downturn doesn’t bother us. It is an opportunity to increase our ownership of great companies with great management at good prices.” — Warren Buffett
