Wow! Here's how much $5,000 of Woolworths shares bought 5 years ago would be worth now

Have Woolworths shares been a worthwhile long-term investment?

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Key points

  • Woolworths shares have almost doubled in value over the past 5 years 
  • When factoring in dividends, an initial investment of $5,000 would have reaped around $9,500 
  • The ASX has generated a yearly average return of 5.34% since 2017 compared to 10.95% for Woolworths 

The Woolworths Group Ltd (ASX: WOW) share price has continued to deliver wealth to investors over the past five years.

Arguably, investing your money in the ASX's safest and most reliable companies can reap some serious rewards over time.

Below, we calculate how much you would have made if you'd bought $5,000 worth of Woolworths shares five years ago.

How much would your initial investment be worth now?

If you spent $5,000 on Woolworths shares exactly 5 years ago, you would have picked them up for $23.41 apiece. The purchase would deliver approximately 213 shares without topping up during down periods.

Looking at yesterday's closing price, the Woolworths share price finished at $39.47. This means those 213 shares would now be worth $8,407.11.

When looking at percentage terms, this implies an average yearly return of 10.95%. In comparison, the S&P/ASX 200 Index (ASX: XJO) has given back roughly 5.34% over the same timeframe.

And the Woolworths dividends?

Over the course of the last five years, Woolworths has made a total of 12 dividend payments from 2017 to 2022. Its latest dividend distribution was significantly lower as the Omicron outbreak affected operations during the first half of FY22.

Adding those 12 dividend payments gives us an amount of $5.30 per share. Calculating the number of shares owned against the total dividend payment gives us a figure of $1,128.90.

When putting both the initial investment gains and dividend distribution, an investor would have $9,536.01 worth of Woolworths shares.

As you can see from the above, investing in Woolworths shares would have almost doubled your initial investment.

In comparison, investing the same amount in an ASX 200 index-tracking fund would have netted you a total figure of $6,485.02 (albeit excluding any dividends).

Woolworths share price snapshot

Over the past 12 months, the Woolworths share price has travelled 5% higher and is up 3% year to date.

The company's shares hit a 52-week low of $33.45 in January before rebounding higher in the following months.

Woolworths presides a market capitalisation of roughly $47.91 billion and has more than 1.21 billion shares on its registry.

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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