“Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years.”
— Warren Buffett
Avery Dennison Corp (NYSE: AVY) provides a useful case study in long-term equity compounding. Over the 10-year period from 07/15/2016 through 07/14/2026, a $10,000 investment in AVY grew to $25,662.48 with dividends reinvested. That result reflects both share-price appreciation and the incremental effect of buying additional shares through the company’s dividend stream.
The broader point is straightforward: long holding periods often change how an investment should be evaluated. Daily price movements can dominate attention in the short run, but total return over a decade is driven more by business performance, valuation changes, and capital returned to shareholders. For dividend-paying stocks in particular, reinvestment can materially affect the ending outcome.
AVY 10-Year Return Details
| Start date: | 07/15/2016 |
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| End date: | 07/14/2026 | ||||
| Start price/share: | $73.53 | ||||
| End price/share: | $157.16 | ||||
| Starting shares: | 136.00 | ||||
| Ending shares: | 163.31 | ||||
| Dividends reinvested/share: | $27.07 | ||||
| Total return: | 156.66% | ||||
| Average annual return: | 9.88% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $25,662.48 | ||||
On these assumptions, AVY delivered a 156.66% total return over the full holding period, equivalent to an annualized return of 9.88%. In practical terms, the original $10,000 investment more than doubled and a half, reaching $25,662.48 by 07/14/2026. These figures were computed using the Dividend Channel DRIP Returns Calculator.
What Drove The 10-Year Return
The outcome came from two sources:
- Share-price appreciation: AVY rose from $73.53 to $157.16 per share over the period.
- Dividend reinvestment: cash dividends were used to purchase additional shares, increasing the share count from 136.00 to 163.31.
That distinction matters. Looking only at the stock price understates the full economic result. The ending share count was roughly 20% higher than the starting share count, which shows how reinvestment can add meaningfully to long-term compounding even when the dividend yield is not especially high.
How Dividend Reinvestment Changed The Result
Over the past 10 years, Avery Dennison Corp paid $27.07 per share in dividends. In this analysis, each dividend is assumed to have been reinvested into additional AVY shares at the closing price on the ex-dividend date. That process steadily increased the investor’s ownership stake without requiring fresh capital.
For long-term holders, dividend reinvestment can have three important effects:
- It increases the number of shares owned over time.
- It allows future dividends to be paid on a larger share base.
- It can improve total return materially over multi-year holding periods.
In AVY’s case, the increase from 136.00 shares to 163.31 shares helps explain why the ending value exceeded what price appreciation alone would have produced.
Current Yield And Yield On Cost
Based upon the most recent annualized dividend rate of $4 per share, AVY has a current yield of approximately 2.55% using the ending share price of $157.16. A separate concept is yield on cost, which compares the current annualized dividend to the original purchase price rather than the current market price.
Using the original entry price of $73.53 per share, the current $4 annualized dividend implies a yield on cost of 5.44%.
Key Takeaways From The AVY 10-Year Holding Period
For investors evaluating Avery Dennison’s long-term return profile, the 2016 to 2026 period highlights several points:
- Total return is the right lens: price change alone does not capture the full result for a dividend-paying stock.
- Reinvestment mattered: dividends increased the share count and amplified compounding.
- Time horizon shaped the outcome: a decade-long holding period produced a far clearer picture than short-term price volatility ever could.
Avery Dennison operates in labeling, packaging materials, and related industrial and retail identification markets, making it a business tied to broad commercial activity rather than a narrow single-product cycle. That does not eliminate cyclicality or valuation risk, but it helps explain why a long-term analysis can be more informative than a short-term trading view.
“Successful investing is anticipating the anticipations of others.” — John Maynard Keynes
