CAGR = Compound Annual Growth Rate
A business (not accounting) term showing the mean growth rate of a business metric on an annualized basis. For instance you can use it to describe revenue growth or decline for a business over several years. Or investors can use it to describe a smoothed gain or loss over a given investment period of time.
CAGR = (Ending Value) / (Beginning Value) raised to the 1 over number of years value minus 1.
Note: A CAGR is not a house party with lots of beer in big metal drums.
Related Fool Articles
- Time value of money
- Internal rate of return
- Discount rate
- Rate of return
- Compound interest
Recent Mentions on Fool.com
- Dividend Stocks: 3 Reasons Rockwell Automation is Still a Great Long-Term Investment
- Are Biosimilars the Next Big Thing in Biotech?
- Mobile Tech: 3 Up-and-Coming Stocks to Watch
- 3 High-Yield Energy Dividends Wall Street is Missing
- Will Microsoft Corporation Cede This $14 Billion Market to Apple Inc. and Google Inc.?
- Is Union Pacific Corp.'s Business Model the Key to Its Success?