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Calculation Machine

CAGR Calculator

Compound annual growth rate between any two values.

Reviewed by the Calculation Machine team · Updated 24 October 2026 · How we check our maths

Your values

ⓘ Live results

Results
CAGR
16.5%
Total growth
150%
Doubling time at this rate
4.5 years

Working

  1. 1CAGR = (125000 ÷ 50000)^(1/6) − 1 = 16.5%

Quick answer

CAGR (compound annual growth rate) is the steady yearly rate that would take a starting value to an ending value: (ending value ÷ starting value)^(1 ÷ years) − 1. Growing from $50,000 to $125,000 over 6 years is (2.5)^(1/6) − 1 = 16.5% a year. It smooths out the ups and downs, so it shows the average pace, not what happened in any single year.

What the CAGR calculator does

This calculator gives the compound annual growth rate between any two values, plus the total percentage growth and how long it takes to double at that rate. It works for anything that grows or shrinks over time: an investment or portfolio, company revenue, a customer base, website traffic, house prices or population.

CAGR is the fairest single number for comparing growth over different lengths of time. Investment funds, annual reports and market research all quote it because, unlike a simple average of yearly percentages, it reflects how compounding actually works.

It only uses the start and end values, so it hides volatility and ignores money added or withdrawn along the way. If you made contributions or withdrawals, use the IRR calculator instead. To project a value forward at a given rate, use the compound interest calculator.

The formula

CAGR = (EV ÷ BV)^(1 ÷ n) − 1 Ending value = BV × (1 + CAGR)^n Doubling time = ln 2 ÷ ln(1 + CAGR)

Formula variables
SymbolMeaningUnit
BVBeginning value at the start of the periodany (e.g. $, units, users)
EVEnding value at the end of the period, in the same unitsame as BV
nNumber of years between the two values; use decimals for part yearsyears

CAGR is the geometric mean annual growth rate, used throughout corporate finance and investment reporting. For an investment, it equals the annualized return only if nothing was added or withdrawn. It cannot be calculated if the starting value is zero or if the values change sign (for example, a loss turning into a profit).

Worked examples

Company revenue over five years

A business grew annual revenue from $2.4M to $6.1M over five years.

Inputs

  • Starting value2400000 $
  • Ending value6100000 $
  • Years5 years

Result

  • CAGR20.51%
  • Total growth154.17%
  • Doubling time at this rate3.7 years

About 20.5% a year, compounded. At that pace revenue doubles roughly every 3.7 years, a useful check on whether a five-year plan is realistic.

Investment held for a decade

$10,000 invested in a fund was worth $17,200 ten years later, with no further contributions.

Inputs

  • Starting value10000 $
  • Ending value17200 $
  • Years10 years

Result

  • CAGR5.57%
  • Total growth72%
  • Doubling time at this rate12.8 years

5.57% a year. Compare that with inflation and with a low-cost index fund over the same decade to judge whether the fund earned its fees.

A declining value

A product line's sales fell from $85,000 to $62,000 over four years.

Inputs

  • Starting value85000 $
  • Ending value62000 $
  • Years4 years

Result

  • CAGR-7.58%
  • Total growth-27.06%
  • Doubling time at this rateNot growing

A CAGR of about −7.6%: sales shrank by that much a year on average. A negative CAGR is still useful for forecasting when to discontinue or reinvest in a line.

Why CAGR differs from average annual return

A simple average of yearly returns overstates growth when returns vary. If an investment gains 50% one year and loses 50% the next, the average return is 0%, but $100 becomes $150 and then $75. The CAGR is (75 ÷ 100)^(1/2) − 1 = −13.4% a year, which matches what actually happened to the money.

The more volatile the returns, the bigger the gap between the arithmetic average and the CAGR. That is why fund performance should be compared on annualized (compound) returns.

CAGR at a glance: growth multiples

How much a value multiplies over common periods at different CAGRs. Doubling times follow the rule of 72 closely; the rule of 72 calculator gives a quick estimate for any rate.

Growth multiple = (1 + CAGR)^years
CAGRAfter 5 yearsAfter 10 yearsDoubling time
3%1.16×1.34×23.4 years
5%1.28×1.63×14.2 years
7%1.40×1.97×10.2 years
10%1.61×2.59×7.3 years
15%2.01×4.05×5.0 years
20%2.49×6.19×3.8 years

Limits of CAGR

  • It ignores the path. Two investments with the same CAGR can have very different risk; one may have fallen 40% along the way.
  • It ignores cash flows. Contributions inflate the ending value and make CAGR look better than the actual return. Use IRR or a time-weighted return when money moved in or out.
  • It depends on the endpoints. Starting at a market low or ending at a peak can make growth look much stronger. Test a few different start and end years.
  • Short periods mislead. Annualizing a few months of growth assumes it continues all year. For a simple gain over any period, the ROI calculator is clearer.

How to use the CAGR Calculator

  1. 1Enter the starting value at the beginning of the period.
  2. 2Enter the ending value at the end of the period, in the same unit.
  3. 3Enter the number of years between them; for months, divide by 12 (30 months = 2.5).
  4. 4Read CAGR, total growth and the doubling time at that rate.

Frequently asked questions

How do you calculate CAGR?

Divide the ending value by the starting value, raise the result to the power of 1 divided by the number of years, then subtract 1. From 100 to 200 over 5 years: 2^(0.2) − 1 = 14.9% a year.

How do I calculate CAGR in Excel?

Use =(end/start)^(1/years)-1 and format the cell as a percentage. The RRI function, =RRI(years, start, end), gives the same answer.

Can CAGR be negative?

Yes. If the ending value is lower than the starting value, CAGR is negative and shows the average yearly decline.

What is a good CAGR?

It depends on what is growing. For a diversified stock investment, long-run CAGRs in the mid to high single digits after inflation are typical historically, while young companies can grow revenue at 30% or more a year.

What is the difference between CAGR and IRR?

CAGR uses only a start and an end value. IRR accounts for every cash flow in between, so it is the right measure when money was added or withdrawn during the period.

References

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