“Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years.”
— Warren Buffett
The Warren Buffett investment philosophy calls for a long-term investment horizon, where a decade-long holding period, or even longer, would fit right into the strategy. How would such a strategy have worked out for an investment into Home Depot Inc (NYSE: HD)? Today, we examine the outcome of a decade-long investment into the stock back in 2016.
| Start date: | 02/19/2016 |
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| End date: | 02/18/2026 | ||||
| Start price/share: | $121.69 | ||||
| End price/share: | $383.52 | ||||
| Starting shares: | 82.18 | ||||
| Ending shares: | 104.29 | ||||
| Dividends reinvested/share: | $62.64 | ||||
| Total return: | 299.99% | ||||
| Average annual return: | 14.86% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $39,996.12 | ||||
As shown above, the decade-long investment result worked out quite well, with an annualized rate of return of 14.86%. This would have turned a $10K investment made 10 years ago into $39,996.12 today (as of 02/18/2026). On a total return basis, that’s a result of 299.99% (something to think about: how might HD shares perform over the next 10 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Notice that Home Depot Inc paid investors a total of $62.64/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 9.2/share, we calculate that HD has a current yield of approximately 2.40%. Another interesting datapoint we can examine is ‘yield on cost’ — in other words, we can express the current annualized dividend of 9.2 against the original $121.69/share purchase price. This works out to a yield on cost of 1.97%.
One more investment quote to leave you with:
“Taking risks is really the only way to consistently achieve above-average returns.” — Sam Zell
