“Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years.”
— 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 decade-long period?
Today, let’s look backwards in time to 2016, and take a look at what happened to investors who asked that very question about Norfolk Southern Corp (NYSE: NSC), by taking a look at the investment outcome over a decade-long holding period.
| Start date: | 02/11/2016 |
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| End date: | 02/10/2026 | ||||
| Start price/share: | $71.67 | ||||
| End price/share: | $315.45 | ||||
| Starting shares: | 139.53 | ||||
| Ending shares: | 171.31 | ||||
| Dividends reinvested/share: | $41.28 | ||||
| Total return: | 440.40% | ||||
| Average annual return: | 18.37% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $54,052.75 | ||||
As shown above, the decade-long investment result worked out exceptionally well, with an annualized rate of return of 18.37%. This would have turned a $10K investment made 10 years ago into $54,052.75 today (as of 02/10/2026). On a total return basis, that’s a result of 440.40% (something to think about: how might NSC shares perform over the next 10 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Notice that Norfolk Southern Corp paid investors a total of $41.28/share in dividends over the 10 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 5.4/share, we calculate that NSC has a current yield of approximately 1.71%. Another interesting datapoint we can examine is ‘yield on cost’ — in other words, we can express the current annualized dividend of 5.4 against the original $71.67/share purchase price. This works out to a yield on cost of 2.39%.
Another great investment quote to think about:
“Compound interest is the eighth wonder of the world. He who understands it, earns it; he who doesn’t, pays it.” — Albert Einstein
