“Someone’s sitting in the shade today because someone planted a tree a long time ago.”
— Warren Buffett
The above quote from Warren Buffett is timeless, and brings into focus the choice about time horizon that any investor should think about before buying a stock they are considering. Behind every stock is an actual business; what will that business look like over a twenty year period?
Today, let’s look backwards in time to 2005, and take a look at what happened to investors who asked that very question about Nucor Corp. (NYSE: NUE), by taking a look at the investment outcome over a twenty year holding period.
| Start date: | 07/18/2005 |
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| End date: | 07/17/2025 | ||||
| Start price/share: | $24.95 | ||||
| End price/share: | $140.75 | ||||
| Starting shares: | 400.80 | ||||
| Ending shares: | 712.71 | ||||
| Dividends reinvested/share: | $33.76 | ||||
| Total return: | 903.14% | ||||
| Average annual return: | 12.21% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $100,271.97 | ||||
The above analysis shows the twenty year investment result worked out quite well, with an annualized rate of return of 12.21%. This would have turned a $10K investment made 20 years ago into $100,271.97 today (as of 07/17/2025). On a total return basis, that’s a result of 903.14% (something to think about: how might NUE shares perform over the next 20 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Notice that Nucor Corp. paid investors a total of $33.76/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 2.2/share, we calculate that NUE has a current yield of approximately 1.56%. Another interesting datapoint we can examine is ‘yield on cost’ — in other words, we can express the current annualized dividend of 2.2 against the original $24.95/share purchase price. This works out to a yield on cost of 6.25%.
Another great investment quote to think about:
“It’s not whether you’re right or wrong that’s important, but how much money you make when you’re right and how much you lose when you’re wrong.” — George Soros
