“Someone’s sitting in the shade today because someone planted a tree a long time ago.”
— Warren Buffett
The investment philosophy practiced by Warren Buffett calls for investors to take a long-term horizon when making an investment, such as a two-decade holding period (or even longer), and reconsider making the investment in the first place if unable to envision holding the stock for at least five years. Today, we look at how such a long-term strategy would have done for investors in Dollar Tree Inc (NASD: DLTR) back in 2004, holding through to today.
| Start date: | 09/24/2004 |
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| End date: | 09/23/2024 | ||||
| Start price/share: | $8.90 | ||||
| End price/share: | $71.76 | ||||
| Starting shares: | 1,123.60 | ||||
| Ending shares: | 1,123.60 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | 706.29% | ||||
| Average annual return: | 10.99% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $80,569.99 | ||||
As we can see, the two-decade investment result worked out quite well, with an annualized rate of return of 10.99%. This would have turned a $10K investment made 20 years ago into $80,569.99 today (as of 09/23/2024). On a total return basis, that’s a result of 706.29% (something to think about: how might DLTR shares perform over the next 20 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Here’s one more great investment quote before you go:
“All intelligent investing is value investing: acquiring more that you are paying for. You must value the business in order to value the stock.” — Charlie Munger
