“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. In practice, that means identifying durable businesses with strong competitive positions and letting the power of compounding work over time.
How would such a strategy have worked out for an investment into Quanta Services, Inc. (NYSE: PWR)? Today, we examine the outcome of a decade-long investment into the stock back in 2016.
Quanta Services is a leading provider of specialty contracting services to the electric power, renewable energy, communications, and pipeline industries. The company has benefited over the last decade from substantial capital spending on grid modernization, renewable generation interconnection, electric vehicle infrastructure, and data & communications networks. These secular tailwinds, combined with disciplined capital allocation, help explain the robust long-term shareholder returns shown below.
| Start date: | 03/10/2016 |
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| End date: | 03/09/2026 | ||||
| Start price/share: | $22.11 | ||||
| End price/share: | $568.04 | ||||
| Starting shares: | 452.28 | ||||
| Ending shares: | 461.08 | ||||
| Dividends reinvested/share: | $2.07 | ||||
| Total return: | 2,519.12% | ||||
| Average annual return: | 38.62% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $261,974.45 | ||||
As shown above, the decade-long investment result worked out exceptionally well, with an annualized rate of return of 38.62%. This would have turned a $10K investment made 10 years ago into $261,974.45 today (as of 03/09/2026). On a total return basis, that is a result of 2,519.12% (something to think about: how might PWR shares perform over the next 10 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Importantly, this performance was delivered through a full market cycle that included the COVID-19 shock in 2020, a sharp rise in interest rates beginning in 2022, and significant volatility in energy and utility capital spending plans. Long-term shareholders who stayed invested through these macro events were rewarded as Quanta continued to win contracts tied to grid resiliency, renewable integration, and communications infrastructure build-out.
Many investors out there refuse to own any stock that lacks a dividend; in the case of Quanta Services, Inc., investors have received $2.07/share in dividends over the 10-year period examined in the exercise above. Quanta initiated a regular quarterly cash dividend in 2018 and has since adopted a policy of returning a portion of free cash flow to shareholders through both dividends and share repurchases.
This means total return was driven not just by share price appreciation, but also by the dividends received (and what the investor did with those dividends). For this exercise, what we have done with the dividends is to assume they are reinvested — i.e. used to purchase additional shares (the calculations use closing price on ex-date). Reinvestment added roughly 8.8 shares over the decade, modest in absolute terms but incremental to the overall return.
Based upon the most recent annualized dividend rate of .44/share, we calculate that PWR has a current yield of approximately 0.08%. Another interesting datapoint we can examine is ‘yield on cost’ — in other words, we can express the current annualized dividend of .44 against the original $22.11/share purchase price. This works out to a yield on cost of 0.36%.
Although the dividend yield is low, Quanta has historically prioritized reinvesting in organic growth opportunities and acquisitions in its core electric power and renewable infrastructure markets. Over the last decade, the company has expanded its capabilities in areas such as high-voltage transmission, utility-scale solar and wind, and undergrounding of distribution lines, aiming to position itself as a key beneficiary of long-term decarbonization and grid hardening initiatives in North America and, increasingly, internationally.
Investors evaluating PWR today should recognize that the past 10-year performance reflects a combination of favorable industry trends, solid execution, and multiple expansion from a much lower starting valuation in 2016. Future returns will depend on Quanta’s ability to sustain earnings growth, maintain disciplined bidding and project execution, and navigate regulatory and political risk around large-scale infrastructure projects. As with any single-stock investment, outcomes over the next decade may differ materially from the last.
Another great investment quote to think about:
“If you are not willing to own a stock for 10 years, do not even think about owning it for 10 minutes.” — Warren Buffett
