Energy Transfer (NYSE: ET) can be a difficult stock to track. Over the last five years, the share price has risen by a total of 2.4%. There’s a hidden reality, however. Throughout that period, the company paid regularly dividends.
Right now, the dividend yield stands at an impressive 7.9%. What happens when you include those dividends into the total return?
This is how much a $500 investment would be worth today
Just based on stock price appreciation, a $500 investment in Energy Transfer stock would be worth just $512 today. When adding in dividends, however, that $500 investment would now be worth $816, a return of 63.2%. That’s a big difference — another reminder that it’s important to look at total returns, not just share price returns. Total returns account for things like dividends and spinoffs, which can artificially mask or depress a company’s true stock performance.
Even with dividends included, however, Energy Transfer shares have failed to match the return of the S&P 500 index, which delivered a total return of 87.9% over that time period. That’s not surprising. For the 14th year in a row, the S&P 500 index outperformed the majority of actively managed U.S. large-cap stock funds. It’s hard to beat the market, whether it’s through a single stock like Energy Transfer or a professionally managed basket of stocks.
Energy Transfer stock has performed much better than its share price suggests, but simple market indexes like the S&P 500 still have the upper hand over the long term.
Should you invest $1,000 in Energy Transfer right now?
Before you buy stock in Energy Transfer, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Energy Transfer wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you’d have $506,291!*
Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than quadrupled the return of S&P 500 since 2002*.
*Stock Advisor returns as of April 22, 2024
Ryan Vanzo has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
If You’d Invested $500 in Energy Transfer 5 Years Ago, Here’s How Much You’d Have Today was originally published by The Motley Fool
EMEA Tribune is not involved in this news article, it is taken from our partners and or from the News Agencies. Copyright and Credit go to the News Agencies, email [email protected] Follow our WhatsApp verified Channel
