adminAlex Rodriguez has a few regrets — including not thinking more about the stock market as a young baseball player in Seattle during the 1990s dot-com boom.
“When I was in Seattle — I started in 1993 — I wish I would have just bought a bunch of the locals,” the former Major League Baseball All-Star tells CNBC Make It. “If I bought Amazon, Microsoft and Starbucks, I wouldn’t have to work so hard today.”
Rodriguez, 48, probably isn’t hard up for cash. He earned more than $455 million in salary, bonuses and incentives during his 22-year playing career, according to sports contract database Spotrac. He made at least an additional $35 million in endorsements over that time, Forbes estimates.
Today, he’s the CEO and chairman of startup investing firm A-Rod Corp — which he founded in 2003, while still playing ball — and an occasional guest judge on ABC’s “Shark Tank.”
He’d have more money for those startups, and himself, if he’d bought some of those Seattle-based “local” stocks at a young age, he says.
How much those investments would be worth today
Rodriguez received a three-year, $1.3 million contract in August 1993, along with a $1 million signing bonus from the Seattle Mariners.
At the time, Microsoft’s stock price was $2.35 per share, adjusted for any stock splits or dividends. Today, the company’s shares are trading at $334.21 apiece, more than 142 times the price 30 years ago.
Similarly, Starbucks, which went public in 1992, was trading at just 74 cents per share when Rodriguez signed his first contract. Today, the coffee giant’s shares fetch $93.08 apiece, more than 125 times the old price.
Rodriguez declined to speculate on how much he would’ve hypothetically spent on those stocks, but just $1,000 apiece in each would be worth roughly $142,000 and $125,000 today, respectively. Investing $10,000 apiece would’ve pushed each beyond $1 million.
When Amazon went public in 1997 — by which point, Rodriquez had signed a four-year, $10.7 million contract extension — its IPO price was $18 per share, but subsequent stock splits adjusted that value to just 7.5 cents per share, according to the company’s website. Today, its stock trades at $129.65 per share, more than 1,720 times the adjusted IPO price.
An investment of only $1,000 at the time would be worth more than $1.7 million today.
Rodriguez’s financial advice for his younger self
Rodriguez, like any other investor, would have had to weather some down times, like the bursting of the dot-com bubble in 2000. Still, his best advice for his younger self: Make smart long-term investments as soon as possible, he told Make It in 2019.
“You have an incredible opportunity if you’re frugal and you’re smart and you put your money away early,” Rodriguez said. “The ability to have compound interest over 20, 30, 40 years — you can be a very wealthy young person in a very short period of time.”
To an extent, Rodriguez followed his own advice. He started buying real estate at age 22, starting “really small” with just a duplex, he says. Today, his investment firm — where he’s said he works harder than he did as a baseball player — owns more than 20,000 multi-family apartments, among other holdings, he says.
Rodriguez is also currently a baseball analyst for FOX Sports and ESPN, and a co-owner of the National Basketball Association’s Minnesota Timberwolves. He recently partnered with OraPharma to raise awareness about gum health after a recent gum disease diagnosis.
Of his path as an investor, he notes that “along the way, there’s mistakes made, lessons learned. But, if you go long and steady, you play the long game. I just wanted to keep getting better and learning more every year.”
Disclosure: CNBC owns the exclusive off-network cable rights to “Shark Tank.”
DON’T MISS: Want to be smarter and more successful with your money, work & life? Sign up for our new newsletter!
Get CNBC’s free Warren Buffett Guide to Investing, which distills the billionaire’s No. 1 best piece of advice for regular investors, do’s and don’ts, and three key investing principles into a clear and simple guidebook.
Read the full article here
