CAGR

Compound Annual Growth Rate.

Calculated from total growth over a multiple years period as:

CAGR = ( ( End amount ) / ( Starting amount ) )^(1/n) - 1

Where n = number of years.

Example

Sales grow from $100m to $150m over a two-year period.

CAGR is:

= ( 150 / 100 )^(1/2) - 1

= 22.5%.

See also

• Compound interest