“Someone’s sitting in the shade today because someone planted a tree a long time ago.”
— Warren Buffett
A long-term investment in Intuit Inc (NASD: INTU) illustrates how compounding can meaningfully reshape outcomes over time. An investor who committed $10,000 to Intuit in August 2006, reinvested dividends, and held through August 2026 would have seen that position grow to $128,873.67. The exercise highlights not only the effect of share price appreciation, but also the contribution of dividend reinvestment across a full market cycle that included recessions, recoveries, and changing interest-rate regimes.
Intuit 20-Year Return Details
| Start date: | 08/21/2006 |
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| End date: | 08/18/2026 | ||||
| Start price/share: | $31.10 | ||||
| End price/share: | $350.41 | ||||
| Starting shares: | 321.54 | ||||
| Ending shares: | 367.74 | ||||
| Dividends reinvested/share: | $31.92 | ||||
| Total return: | 1,188.59% | ||||
| Average annual return: | 13.63% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $128,873.67 | ||||
What Drove the Return
The result was driven primarily by capital appreciation. Intuit shares rose from $31.10 to $350.41 over the holding period, reflecting substantial growth in the company’s equity value. Dividend reinvestment added a secondary layer of compounding by increasing the share count from 321.54 to 367.74. In other words, the return came from two sources:
- Higher share price over time
- Additional shares accumulated through reinvested dividends
The combination produced a total return of 1,188.59%, equivalent to an average annual return of 13.63% over the period shown. [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Why Time Horizon Matters
Long holding periods can change the way investment results are experienced. Over nearly two decades, an owner of Intuit would have lived through multiple episodes of market volatility, including broad selloffs and sharp recoveries. Yet the long-term outcome in this example was determined less by interim price swings than by the persistence of the holding period and the underlying business performance that supported value creation over time.
This is one of the clearest lessons from compounding: short-term market noise can be significant, but the mathematics of long-duration returns are dominated by the rate of compounding and the length of time capital remains invested.
Dividend Reinvestment and Yield on Cost
Intuit paid a cumulative $31.92 per share in dividends over the period used in this analysis. Reinvesting those cash distributions increased the investor’s share count, which in turn allowed future dividends and future price appreciation to compound on a larger base.
Using the most recent annualized dividend rate of $4.80 per share, INTU has a current yield of approximately 1.37% based on the ending share price of $350.41. Another useful measure is yield on cost, which compares the current annualized dividend to the original purchase price of $31.10 per share:
- Current annualized dividend: $4.80 per share
- Original purchase price: $31.10 per share
- Yield on cost: 4.80 / 31.10 = 15.43%
That distinction matters. Current yield describes what a new buyer would earn at today’s price, while yield on cost shows how the income stream has grown relative to the original capital committed. For long-term holders of dividend-paying companies, yield on cost can become materially higher than the stock’s prevailing market yield.
A Brief Business Context for Intuit
Intuit is best known for financial software and services serving consumers, small businesses, and tax professionals, with core brands including TurboTax, QuickBooks, Credit Karma, and Mailchimp. That mix has given the company exposure to recurring small-business workflows, tax preparation, and consumer finance tools. Over time, software businesses with established ecosystems, high customer retention, and pricing power can support durable cash generation, which helps explain why certain technology-enabled platforms have been able to compound shareholder value over long periods.
That said, even strong historical returns do not emerge in a straight line. Valuation, competitive dynamics, execution, and changing end-market conditions all influence future outcomes. A strong backward-looking result is most useful as a case study in long-term compounding rather than a guarantee of similar performance ahead.
Key Takeaways
- A $10,000 investment in Intuit in August 2006 grew to $128,873.67 by August 2026 in this dividend-reinvestment scenario.
- The position generated a total return of 1,188.59% and an average annual return of 13.63%.
- Most of the gain came from long-term share price appreciation, with dividends adding incremental compounding through reinvestment.
- Based on a $4.80 annualized dividend, current yield is about 1.37%, while yield on cost is approximately 15.43% using the original $31.10 purchase price.
“Cash combined with courage in a time of crisis is priceless.” — Warren Buffett
