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
- Get in on the Ground Floor With the 'Warren Buffett of MLPs'
- Black Swan Events: Avoiding Disaster When Investing in MLPs
- Carl Icahn and Elon Musk Are Wrong: Here's Why eBay Keeping PayPal Makes Sense
- Will You Be in High Spirits Owning This Stock?
- Why Visteon Corporation Will Be a Winner in the Changing Automotive Landscape
- Ciena Is Down, but Not Out