The stock market is so dynamic that it’s difficult to predict what a stock will do over a two-year stretch, much less a 25-year stretch. Yet every young long-term investor is looking for the best stocks to own for the next quarter century.
While none of us can look 25 years into the future, it can be helpful to look 25 years to the past at some of the best stocks of the last quarter century.
Since August 1, 1991, the S&P 500’s total return has been 463%. Each of the following top stocks generated total returns exponentially higher in that time.
Public Storage (PSA) +7,890%
One of the common denominators among all these top stocks is dividends. You’ll notice that these returns are total returns, which combines increases in share price with dividend payments.
Public Storage (PSA) stock pays a generous 3.2% dividend, and the company has grown to become the largest self-storage company in the world. Since the company is structured as a REIT, 90% of its earnings have been returned to shareholders as dividend payments. Therefore, a large part of the company’s 25-year gain has come from dividends.
TJX Companies Inc (TJX) +8,918%
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