I'll be the first to admit it. It can be hard to let winning stock investments run. Sure, it's a core principle here at The Motley Fool, but it's still difficult. There's something about human nature that makes us all want to lock in a modest gain rather than risk turning winning investments into losers.
However, the fact remains: It's better to let your winners run. Adobe (ADBE 0.87%), with its stellar 20-year history of outstanding returns, is just one example. Let's dive in and see why.
Image source: Getty Images.
Adobe's rising stock has been fueled by astonishing growth
First off, big stock market winners often have one thing in common -- they have grown their revenue in impressive fashion. And Adobe is no exception.
Since October 2003, the company's trailing-12-month revenue has soared from $1.3 billion to $18.9 billion. That's a compound annual growth rate (CAGR) of 14.3%. To put this another way, annual revenue has increased 1,360%.
ADBE Revenue (TTM) data by YCharts
What's more, this incredible revenue growth isn't confined to the distant past. Over the last five years, the company averaged 17% revenue growth, and overall revenue more than doubled from $9 billion to almost $19 billion today.
A $10,000 investment in 2003 would have grown to more than $265,000 today
All that growth has led to a ballooning of Adobe's stock value. An investor who bought $10,000 worth of Adobe shares in October 2003 -- and held on to them -- would have $265,210 worth of stock today.
ADBE Total Return Level data by YCharts
For context, a $10,000 investment in the S&P 500 index made at the same time would be worth a little over $60,000 today.
Simply put, Adobe's nearly 18% CAGR over 20 years is a fantastic return that any investor should be thrilled with.
Is Adobe stock a buy now?
While Adobe's past performance is spectacular, its future looks just as bright. The company's products are mainstays for countless designers, teachers, and marketers. What's more, Adobe is at the forefront of integrating generative artificial intelligence features into its products, leading to stunning creations and edits. In addition, the company's subscription model makes its revenue more regular and predictable compared to other software companies.
Long-term investors would be wise to double-down on this growth superstar.
