“When we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever.”
— Warren Buffett
One of the most important things investors can learn from Warren Buffett, is about how they approach their time horizon for an investment into a stock under consideration. Because immediately after buying shares of a given stock, investors will then be able to check on the day-to-day (and even minute-by-minute) market value. Some days the stock market will be up, other days down. These daily fluctuations can often distract from the long-term view. Today, we look at the result of a two-decade holding period for an investor who was considering American Tower Corp (NYSE: AMT) back in 2005, bought the stock, ignored the market’s ups and downs, and simply held through to today.
| Start date: | 11/21/2005 |
|
|||
| End date: | 11/19/2025 | ||||
| Start price/share: | $26.17 | ||||
| End price/share: | $180.50 | ||||
| Starting shares: | 382.12 | ||||
| Ending shares: | 517.53 | ||||
| Dividends reinvested/share: | $50.91 | ||||
| Total return: | 834.14% | ||||
| Average annual return: | 11.82% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $93,495.04 | ||||
As shown above, the two-decade investment result worked out quite well, with an annualized rate of return of 11.82%. This would have turned a $10K investment made 20 years ago into $93,495.04 today (as of 11/19/2025). On a total return basis, that’s a result of 834.14% (something to think about: how might AMT shares perform over the next 20 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Notice that American Tower Corp paid investors a total of $50.91/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 6.8/share, we calculate that AMT has a current yield of approximately 3.77%. Another interesting datapoint we can examine is ‘yield on cost’ — in other words, we can express the current annualized dividend of 6.8 against the original $26.17/share purchase price. This works out to a yield on cost of 14.41%.
One more investment quote to leave you with:
“Taking risks is really the only way to consistently achieve above-average returns.” — Sam Zell
