Compound Annual Growth Rate — the geometric mean annual growth rate of an investment over a multi-year period.
Formula: (Ending Value / Beginning Value)^(1/n) − 1
How to read it: For revenue/earnings: > 20% is exceptional · 10–20% is strong · < 10% is modest. Compare against sector growth rates and index returns for context.
CAGR is the standard for comparing investment or business performance across different time horizons. It eliminates the distortion of volatility in year-by-year returns and expresses performance as a single smooth annual rate.