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— Warren Buffett

A five-year holding period can be a useful way to evaluate how a dividend-paying utility stock rewards patient shareholders. For investors who bought Pinnacle West Capital Corp (NYSE: PNW) in November 2021 and reinvested dividends, the result was a strong total return through November 2026. The exercise also illustrates a central principle of long-term equity investing: for income-oriented stocks, the combination of share price appreciation and dividend reinvestment often matters more than short-term market volatility.

PNW 5-Year Return at a Glance

PNW 5-Year Return Details
Start date:	11/09/2021	$10,000 11/09/2021   $20,636 11/06/2026
End date:	11/06/2026
Start price/share:	$63.36
End price/share:	$104.22
Starting shares:	157.83
Ending shares:	198.01
Dividends reinvested/share:	$18.53
Total return:	106.37%
Average annual return:	15.61%
Starting investment:	$10,000.00
Ending investment:	$20,636.30

A $10,000 investment in Pinnacle West Capital on 11/09/2021 grew to $20,636.30 by 11/06/2026, assuming dividends were reinvested. That translates to a total return of 106.37% and an annualized return of 15.61%. Stated simply, the original investment more than doubled over the period. [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

How Dividend Reinvestment Affected the Outcome

Dividends were a meaningful part of the return. Over the five-year period, Pinnacle West Capital paid a cumulative $18.53 per share in dividends. When those cash payments are reinvested, they purchase additional shares over time, which then generate dividends of their own. That compounding effect is visible in the share count, which increased from 157.83 shares at the start to 198.01 shares at the end.

This point matters because total return and price return are not the same thing. Share price appreciation took PNW from $63.36 to $104.22, but the fully reinvested outcome was stronger because dividend income continually added to the position. For regulated electric utilities, where dividend policy is often a core part of the investment case, ignoring reinvested income can materially understate long-term performance.

Current Yield and Yield on Cost

Based on the most recent annualized dividend rate of $3.70 per share, PNW has a current yield of approximately 3.55% using the end share price of $104.22. Another useful measure 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 $63.36 per share, the current $3.70 annualized dividend implies a yield on cost of 5.84%. That metric highlights how a stable or growing dividend can improve the income profile of a successful long-term holding, even if the stock’s current yield looks more modest to a new buyer.

Why Utility Stock Total Return Can Surprise

Pinnacle West Capital, the parent company of Arizona Public Service, operates in a sector that is often viewed primarily through the lens of income and defensiveness. Utilities typically do not attract attention for rapid growth, but long holding periods can produce strong compounded returns when three factors align:

• consistent dividend payments,
• reinvestment at various price levels, and
• moderate share price appreciation over time.

That combination can be especially effective when investors hold through periods of market uncertainty rather than reacting to short-term price swings. In practical terms, the PNW example shows how a stock with a meaningful dividend can generate a return profile that looks stronger in hindsight than its day-to-day trading action may have suggested at the time.

Key Takeaways

• A $10,000 investment in PNW on 11/09/2021 grew to $20,636.30 by 11/06/2026.
• The five-year total return was 106.37% with dividends reinvested.
• The annualized return was 15.61%.
• Dividend reinvestment increased the share count from 157.83 to 198.01.
• At a $3.70 annualized dividend, current yield was about 3.55%, while yield on cost was about 5.84%.

For long-term holders of Pinnacle West Capital, the period underscores a straightforward lesson: in dividend stocks, patient ownership and reinvestment can be as important as the entry price itself.

Here’s one more investment quote before you go:
“Never test the depth of a river with both feet.” — Warren Buffett