CAGR Calculator
Find the equivalent annual growth rate between two values. You can also solve for a starting value, ending value or time to a target.
- Total growth
- 50%
- Total growth / years
- 10%
- Years
- 5
- CAGR
- 8.447177%
Assumes no contributions or withdrawals between the starting and ending values. Total growth / years is not the average of observed yearly returns.
Show working
CAGR = ((end / start)^(1 / years) - 1) x 100 Start: 10,000; end: 15,000; years: 5 Result: 8.447177%
What is CAGR?
CAGR stands for compound annual growth rate. It is the constant annual rate that would take a starting value to an ending value over the specified period. It summarizes the two endpoints; it does not show the rises and falls between them.
CAGR = ((ending value / starting value)^(1 / years) – 1) x 100
A value growing from 10,000 to 15,000 over five years has CAGR of approximately 8.4472%. Total growth is 50%, but dividing that by five gives 10%, which is not the compound annual rate.
CAGR can describe revenue, units sold or other positive quantities as well as an investment value. It is a mathematical summary, not a prediction of future performance.
Count the time between the endpoints
Use elapsed time, not the number of labels in a table. An end-of-year value in 2021 and an end-of-year value in 2026 are five years apart. There may be six annual labels, but only five growth intervals.
For an 18-month period, enter 1.5 years. The result is annualized, meaning it expresses the equivalent rate for one year. Annualizing a short period can produce a large number and does not mean that rate will continue.
| Measure | Result | Meaning |
|---|---|---|
| Total growth | 50% | Change over the full period |
| Total growth / years | 10% | Simple division, without compounding |
| CAGR | 8.4472% | Equivalent annual compound rate |
For a single-period change without annualizing, use the percentage increase calculator.
Reverse CAGR calculations
When you know a constant annual rate, rearrange the formula to solve a different unknown. Enter the rate as a percentage, such as 8 for 8%.
Ending value = starting value x (1 + rate / 100)^years
Starting value = ending value / (1 + rate / 100)^years
Years = ln(ending / starting) / ln(1 + rate / 100)
At 8% compounded annually, 10,000 becomes about 14,693.28 after five years. Reaching 15,000 at that same constant rate takes approximately 5.2684 years. These reverse results are hypothetical calculations based on the entered rate.
For interest calculated with different compounding frequencies, use the interest calculator. For gross-pay changes across pay periods, use the salary increase calculator.
CAGR in Excel or Google Sheets
With starting value in A2, ending value in B2 and elapsed years in C2, the formula below returns a decimal rate. Format the result cell as a percentage; do not multiply by 100 as well when applying percentage formatting.
=(B2/A2)^(1/C2)-1
A zero or negative starting value does not support the standard positive-base CAGR interpretation. This calculator also excludes negative ending values. A zero ending value represents a total loss, with an equivalent CAGR of -100%.
Common questions
Does CAGR include contributions or withdrawals?
No. Comparing only the starting and ending balances mixes outside cash flows with growth. Where money enters or leaves at different times, use an appropriate cash-flow return method such as XIRR rather than interpreting this result as an investment return.
Can CAGR be negative?
Yes. A positive starting value declining to a smaller positive ending value produces a negative CAGR. For example, 100 falling to 81 over two years gives -10% per year.
Why can a duration calculation have no answer?
A positive growth rate cannot reach a lower positive target in positive time, and a negative growth rate cannot reach a higher target. A zero rate does not determine a unique duration.
Related calculators
Back to the Percent Calculator.