“When we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever.”
— Warren Buffett
A long holding period can reveal far more about an investment than day-to-day price moves. In the case of Raymond James Financial Inc (NYSE: RJF), a $10,000 investment made on 06/01/2006 and held through 05/29/2026 grew to $96,868.26 with dividends reinvested. That result translates to an 868.56% total return and an average annual return of 12.02%.
The exercise highlights two core drivers of long-term equity returns: capital appreciation and dividend reinvestment. For RJF, both mattered. Share price gains accounted for much of the increase in value, while reinvested dividends steadily expanded the share count over time, strengthening the compounding effect.
| Start date: | 06/01/2006 |
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| End date: | 05/29/2026 | ||||
| Start price/share: | $19.84 | ||||
| End price/share: | $143.41 | ||||
| Starting shares: | 504.03 | ||||
| Ending shares: | 675.38 | ||||
| Dividends reinvested/share: | $15.75 | ||||
| Total return: | 868.56% | ||||
| Average annual return: | 12.02% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $96,868.26 | ||||
Key Takeaways From RJF’s 20-Year Return
As shown above, the long-term investment outcome was substantial. A $10,000 position in Raymond James Financial rose to nearly $97,000 over the period, assuming dividends were reinvested. [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Several points stand out:
- Compounding was the main force. A 12.02% annualized return may not appear extraordinary in any single year, but over two decades it produced a nearly tenfold increase in value.
- Dividends contributed meaningfully. Reinvestment increased the share count from 504.03 to 675.38, allowing future dividends and price appreciation to apply to a larger base.
- Time helped absorb volatility. A period beginning in 2006 would have included the global financial crisis, the pandemic shock, and multiple interest-rate cycles, yet the long-term return remained strong.
How Dividend Reinvestment Changed the Outcome
Dividends are a core part of total return, particularly over long measurement periods. Raymond James Financial paid a cumulative $15.75 per share in dividends across the 20 years covered here. When those distributions are reinvested, they purchase additional shares, which can then generate their own dividends and participate in future upside.
That mechanism is visible in the increase from 504.03 starting shares to 675.38 ending shares. In other words, the investor did not simply benefit from RJF shares rising from $19.84 to $143.41; the investor also ended the period owning materially more shares than at the start.
The calculation above assumes dividend reinvestment at the closing price on each ex-dividend date. This approach is useful because it captures the full economic effect of holding a dividend-paying stock over time rather than focusing only on headline share-price performance.
Current Yield and Yield on Cost
Based on the most recent annualized dividend rate of $2.16 per share, RJF has a current yield of approximately 1.51% using the ending share price of $143.41.
Another useful measure is yield on cost, which compares the current annual dividend to the original purchase price. Using the 2006 entry price of $19.84 per share, the current annualized dividend of $2.16 implies a yield on cost of 10.89%.
That figure differs from current yield because the denominator is different. Current yield measures income relative to today’s market price, while yield on cost measures income relative to the initial purchase price. For long-held dividend stocks, that distinction can be meaningful.
Why the RJF Example Matters
Raymond James Financial is a financial services company, and the stock’s 20-year return profile illustrates a broader point about equity investing in cyclical industries: long-term returns can remain attractive even when the path includes major drawdowns and operating headwinds. What matters most is the combination of business durability, shareholder distributions, and the ability to compound through time.
For investors evaluating long-term stock performance, RJF provides a clear case study in the difference between watching short-term market fluctuations and measuring total return over a full cycle. A disciplined holding period, especially when paired with dividend reinvestment, can produce an outcome that looks very different from the day-to-day experience of owning the shares.
“Compound interest is the eighth wonder of the world. He who understands it, earns it; he who doesn’t, pays it.” — Albert Einstein
