“When we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever.”
— 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 Bunge Global SA (NYSE: BG)? Today, we examine the outcome of a twenty year investment into the stock back in 2005.
| Start date: | 03/14/2005 |
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| End date: | 03/13/2025 | ||||
| Start price/share: | $55.30 | ||||
| End price/share: | $73.59 | ||||
| Starting shares: | 180.83 | ||||
| Ending shares: | 274.00 | ||||
| Dividends reinvested/share: | $29.56 | ||||
| Total return: | 101.63% | ||||
| Average annual return: | 3.57% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $20,174.59 | ||||
As shown above, the twenty year investment result worked out as follows, with an annualized rate of return of 3.57%. This would have turned a $10K investment made 20 years ago into $20,174.59 today (as of 03/13/2025). On a total return basis, that’s a result of 101.63% (something to think about: how might BG shares perform over the next 20 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Notice that Bunge Global SA paid investors a total of $29.56/share in dividends over the 20 holding period, marking a second component of the total return beyond share price change alone. Much like watering a tree, reinvesting dividends can help an investment to grow over time — for the above calculations we assume dividend reinvestment (and for this exercise the closing price on ex-date is used for the reinvestment of a given dividend).
Based upon the most recent annualized dividend rate of 2.72/share, we calculate that BG has a current yield of approximately 3.70%. Another interesting datapoint we can examine is ‘yield on cost’ — in other words, we can express the current annualized dividend of 2.72 against the original $55.30/share purchase price. This works out to a yield on cost of 6.69%.
One more piece of investment wisdom to leave you with:
“Our job is to find a few intelligent things to do, not to keep up with every damn thing in the world.” — Charlie Munger
