Here's Why Investing for the Long Term Matters

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The market has clocked record highs as well as boasted steep daily losses, all in the span of the past several weeks. In short, it’s been a bumpy time for investors. But as a long-term investor, these near-term ups and downs in the market shouldn’t cause you to lose sleep.

In this segment of Backstage Pass, recorded on Oct. 27, Fool contributors Rachel Warren, Brian Withers, and Trevor Jennewine read member comments and touch upon key merits of a long-term investing strategy. 

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Rachel Warren: We had another comment from the last hour about Teladoc (NYSE:TDOC), which I covered Teladoc’s third quarter earnings. FoolFans says Teladoc earnings were good. Why is it down 7% after the earnings it reported? The question [laughs] that continues to plague me. I love this stock.

Brian and I talk about this stock so much. We both are shareholders. We both love this company and the market has just been really tough on it. I’m honestly not sure why, one of the things I can think of was maybe the fact that it reported that membership growth, I believe was just about up 2% year-over-year.

Brian Withers: I think that’s the number that everybody’s gravitating toward. To me the inter-quarter when you make your insurance decisions, and companies set up their health insurance for the coming year. That’s a once in a year kind of thing. Teladoc is going to get some new paid users in between those times.

But to me, the biggest, you’ve got to look at Teladoc on a year-over-year basis, complete year versus just one quarter over another.

I just think if Teladoc is the Rodney Dangerfield, I don’t know if [laughs] you guys are old enough. Rodney Dangerfield was a comedian and he always said, I don’t get no respect and [laughs] that’s Teladoc for me.

Rachel Warren: I fully agree. I think that’s the number that was driving that post-market close dip. But again, over a period of years, both its share price appreciation has been great, but also just its balance sheet growth. I continue to maintain that as a really great stock to buy.

And then Richard O just commented, “I’m much more focused on dividend growth and dividend payers than stock price” and named some great companies including Microsoft and Home Depot. Those are some great quality tried and true stocks there.

Brian Withers: We covered a few of them in the last hour. Sherwin-Williams, I didn’t realize that they had 42 years of increasing dividends and there’s been a couple of others in the last hour that we’re certainly great dividend payers as well.

Rachel Warren: Absolutely, I love those dividend stocks.

Rachel Warren: We are…go ahead, go ahead. 

Trevor Jennewine: Texas Instruments, I think they’ve returned a lot of cash to shareholders.

Rachel Warren: Oh yeah. Dividend stocks, I think are a great way, especially when the market is volatile to keep maximizing your returns. Companies with a very long history of paying out a dividend and raising it, are far less likely to suspend it during kind of volatile time.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.