“Someone’s sitting in the shade today because someone planted a tree a long time ago.”
— Warren Buffett
A key lesson we can learn from Warren Buffett is how to think about a potential stock investment in the context of a long-term time horizon. Every investor in a stock has a choice: bite our fingernails over the short-term ups and downs that are inevitable with the stock market, or zero in on stocks we are comfortable to simply buy and hold for the long haul — maybe even a two-decade holding period. In practice, that means investors can even choose to completely ignore the stock market’s short-run quotations and instead go into their initial investment planning to hold on for years regardless of the fluctuations in price that might occur next.
Today, we examine what would have happened over a two-decade holding period, had you decided back in 2006 to buy shares of Micron Technology Inc. (NASD: MU) and simply hold through to today. Micron is a leading global manufacturer of memory and storage products, including DRAM, NAND and NOR, that serve end markets such as data centers, personal computers, mobile devices, automotive and industrial applications. Over the last two decades the company has cycled through multiple semiconductor booms and busts, navigated the global financial crisis and the COVID-19 downturn, and more recently has been a beneficiary of demand tied to artificial intelligence infrastructure.
| Start date: | 03/09/2006 |
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| End date: | 03/06/2026 | ||||
| Start price/share: | $14.52 | ||||
| End price/share: | $370.30 | ||||
| Starting shares: | 688.71 | ||||
| Ending shares: | 705.95 | ||||
| Dividends reinvested/share: | $2.02 | ||||
| Total return: | 2,514.12% | ||||
| Average annual return: | 17.72% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $261,452.80 | ||||
As we can see, the two-decade investment result worked out exceptionally well, with an annualized rate of return of 17.72%. This would have turned a $10,000 investment made 20 years ago into $261,452.80 today (as of 03/06/2026). On a total return basis, that is a result of 2,514.12%. For perspective, over the same broad period the S&P 500 index delivered a high single-digit to low double-digit annualized total return, so Micron materially outperformed the headline U.S. equity benchmark despite the cyclicality of the memory business.
Of course, the path for Micron shareholders would not have been smooth. The company’s earnings and share price have historically been volatile, reflecting swings in supply and demand for DRAM and NAND, periods of oversupply, and heavy capital expenditure requirements. Long-term buy-and-hold investors willing to ride out drawdowns, including price declines of 50 percent or more during industry downturns, were ultimately compensated with strong compounded returns. This is consistent with Buffett’s broader point that time in the market, provided the underlying business remains competitive and financially resilient, can matter more than short-term timing.
[These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Dividends are always an important investment factor to consider, and Micron Technology Inc. has paid $2.02 per share in dividends to shareholders over the past 20 years we looked at above. Micron only initiated a regular quarterly dividend in calendar 2021, reflecting management’s increased confidence in the company’s balance sheet and cash generation after a period of deleveraging. Many investors will only invest in stocks that pay dividends, so this component of total return is always an important consideration. Automated reinvestment of dividends into additional shares of stock can be a way for an investor to compound their returns over long holding periods.
The above calculations are done with the assumption that dividends received over time are reinvested (the calculations use the closing price on ex-date). In the case of Micron, the increase in ending shares from 688.71 to 705.95 over the period illustrates how even a relatively modest dividend, when reinvested, can incrementally add to share count and long-term value.
Based upon the most recent annualized dividend rate of $0.46 per share, we calculate that MU has a current yield of approximately 0.12%. Another interesting data point we can examine is “yield on cost” — in other words, we can express the current annualized dividend of $0.46 against the original $14.52 per share purchase price. This works out to a yield on cost of 0.83%, a reminder that Micron is fundamentally a growth and capital appreciation story rather than an income-oriented holding.
Looking ahead, Micron’s long-term return profile will depend on factors such as continued demand growth for memory in AI and cloud computing, the company’s ability to manage capital intensity and maintain a strong balance sheet, and the competitive dynamics among leading memory manufacturers in the United States, South Korea and Japan. As with any cyclical technology stock, investors considering a similar buy-and-hold approach should remain mindful of industry risks, periodic recessions in demand and the potential for substantial interim volatility.
One more investment quote to leave you with:
“The investor’s chief problem, even his worst enemy, is likely to be himself.” — Benjamin Graham
