“Someone’s sitting in the shade today because someone planted a tree a long time ago.”
— Warren Buffett
The Warren Buffett investment philosophy calls for a long-term investment horizon, where a twenty year holding period, or even longer, would fit right into the strategy. How would such a strategy have worked out for an investment into Incyte Corporation (NASD: INCY)? Today, we examine the outcome of a twenty year investment into the stock back in 2000.
| Start date: | 01/14/2000 |
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| End date: | 01/13/2020 | ||||
| Start price/share: | $65.91 | ||||
| End price/share: | $77.10 | ||||
| Starting shares: | 151.72 | ||||
| Ending shares: | 151.72 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | 16.98% | ||||
| Average annual return: | 0.79% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $11,705.40 | ||||
As shown above, the twenty year investment result worked out as follows, with an annualized rate of return of 0.79%. This would have turned a $10K investment made 20 years ago into $11,705.40 today (as of 01/13/2020). On a total return basis, that’s a result of 16.98% (something to think about: how might INCY shares perform over the next 20 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
One more piece of investment wisdom to leave you with:
“The ideal business is one that earns very high returns on capital and that keeps using lots of capital at those high returns. That becomes a compounding machine.” — Warren Buffett
