Free Tools CAGR Calculator

A CAGR Calculator is a tool used to calculate the Compound Annual Growth Rate (CAGR) of an investment, business metric, revenue, user base, or any value that grows (or shrinks) over multiple years.

CAGR represents the average annual growth rate, assuming growth occurred at a steady, compounded rate.

Formula

$$\text{CAGR} = \left(\frac{\text{Ending Value}}{\text{Beginning Value}}\right)^{\frac{1}{n}} – 1$$CAGR=(Beginning ValueEnding Value​)n1​−1

Where:

• Beginning Value = starting amount
• Ending Value = final amount
• n = number of years

Example

Suppose:

• Beginning value = $10,000
• Ending value = $16,000
• Time period = 5 years

Calculation:$$\text{CAGR} = \left(\frac{16000}{10000}\right)^{\frac{1}{5}} – 1$$CAGR=(1000016000​)51​−1 $$\text{CAGR} \approx 0.0986 = 9.86\%$$CAGR≈0.0986=9.86%

So the investment grew at an average compounded rate of 9.86% per year.

Why CAGR Is Useful

CAGR helps you:

• Compare investment performance across different time periods.
• Measure business growth (revenue, profits, customers, etc.).
• Smooth out year-to-year volatility.
• Estimate future values based on historical growth.

What a CAGR Calculator Does

A CAGR calculator typically asks for:

1. Starting value
2. Ending value
3. Number of years

Then it automatically computes the CAGR percentage.

Quick Calculation

If you provide:

• Starting value
• Ending value
• Number of years