Dividend CAGR Calculator
Calculate the compound annual growth rate of a company’s annual dividend per share over multiple years.
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Understand dividend CAGR
Dividend CAGR smooths a multi-year change into an equivalent compounded annual rate for comparison.
Formula
Worked example
A dividend growing from $2.50 to $4.00 over five years has a CAGR of about 9.86%.
How to interpret the result
Dividend CAGR smooths a multi-year change into an equivalent compounded annual rate for comparison.
Assumptions & limitations
This is a historical or scenario-based rate. Dividend growth is not guaranteed, and irregular payment changes can make CAGR less representative.
Practical context
When this calculator is useful
Dividend CAGR is useful when a company has changed its dividend over several years and you want a single annualized growth rate rather than a list of yearly changes. It smooths uneven increases into a comparable long-term rate.
How investors commonly use it
Income investors often compare dividend CAGR across companies or across different periods for the same company, then consider whether that growth was supported by earnings and free cash flow.
What this metric does not tell you
A historical dividend CAGR does not guarantee future increases. It can conceal pauses or cuts within the measurement period and says nothing by itself about payout sustainability, valuation or the starting dividend yield.