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Calculate dividend growth with CAGR, one-year, sustainable, and future dividend formulas. See clear steps, examples, and results.
The Dividend Growth calculator helps you measure and estimate dividend growth. It has four calculation modes. You can calculate historical dividend growth with CAGR, one-year growth, sustainable growth, or a future dividend. Each mode uses different inputs and a specific formula. The calculator checks your entries before it shows a result. This makes it useful for dividend analysis, stock research, and simple income planning.
Use the calculator above to calculate your dividend growth based on the method you need.
A Dividend Growth calculator shows how a dividend changes over time. It can measure past growth or estimate future dividends.
The calculator has four modes:
The result depends on the inputs you enter. The calculator doesn't use one formula for every case.
The calculator first checks the selected mode. It then checks the required inputs. Invalid values are rejected.
For CAGR, you enter the beginning dividend, ending dividend, and number of years. The calculator then finds the annual growth rate.
For one-year growth, you enter the previous dividend and new dividend. The calculator finds both the dollar change and growth rate.
For sustainable growth, you enter ROE and the dividend payout ratio. The calculator first finds the retention ratio. It then uses ROE and retention to estimate growth.
For future dividends, you enter the current dividend, growth rate, and forecast period. The calculator compounds the dividend for that period.
The code uses a result flag after successful validation. This means the result is shown only after the required values pass the checks.
The CAGR formula is:
Dividend Growth Rate = [(Ending Dividend / Beginning Dividend)^(1 / Number of Years) − 1] × 100
Here:
The calculator requires both dividends and the number of years to be greater than zero.
The one-year change is:
Dividend Change = New Dividend − Previous Dividend
The growth rate is:
Dividend Growth Rate = [(New Dividend − Previous Dividend) / Previous Dividend] × 100
The previous dividend must be greater than zero. The new dividend may be zero.
First, find the retention ratio:
Retention Ratio = 1 − Dividend Payout Ratio
Then:
Sustainable Growth Rate = ROE × Retention Ratio
Or:
Sustainable Growth Rate = ROE × (1 − Payout Ratio)
The calculator converts ROE and the payout ratio from percentages into decimals before the calculation.
The future dividend formula is:
Future Dividend = Current Dividend × (1 + Growth Rate)^Forecast Period
The calculator converts the growth rate from a percentage to a decimal first.
The available inputs come directly from the calculator code. CAGR uses beginning dividend, ending dividend, and years. One-year growth uses previous and new dividends. Sustainable growth uses ROE and payout ratio. Future growth uses current dividend, growth rate, and forecast period.
Suppose a company paid $1.50 per share five years ago. Its dividend is now $2.50.
Beginning dividend = $1.50
Ending dividend = $2.50
Years = 5
Formula:
Growth Rate = [(2.50 / 1.50)^(1 / 5) − 1] × 100
Growth Rate = 10.7583%
So, the annualized dividend growth rate is about 10.76%.
The calculator uses the same power calculation in its CAGR mode.
Previous dividend = $2.00
New dividend = $2.20
First find the change:
$2.20 − $2.00 = $0.20
Then calculate growth:
($0.20 / $2.00) × 100 = 10%
The dividend increased by $0.20, or 10%.
Current dividend = $2.00
Growth rate = 6%
Forecast period = 3 years
Future Dividend = $2.00 × (1 + 0.06)^3
Future Dividend = $2.00 × 1.06^3
Future Dividend = $2.3820
The estimated dividend after three years is $2.3820 per share.
Manual dividend calculations can take time. A calculator gives you a quick way to check the math.
It can help you compare past dividend growth rates. You can also test different growth assumptions. The future dividend mode can show how compounding affects a dividend over time.
The four modes also let you choose a method that fits your question. For example, use CAGR for a multi-year history. Use one-year growth for a recent change.
The result changes when the calculator inputs change.
For CAGR, the key factors are the beginning dividend, ending dividend, and number of years.
For one-year growth, the previous and new dividends control the result.
For sustainable growth, ROE and the payout ratio affect the result. A higher retention ratio increases the calculated growth when ROE stays the same.
For future dividends, the current dividend, growth rate, and forecast period affect the result.
The calculator also applies input limits. For example, the payout ratio must be from 0% to 100%. The future growth rate must be greater than -100%.
A long-term investor may use CAGR to compare a company's dividend growth over five years.
An investor checking a recent dividend increase may use one-year growth. This gives the percentage change between two dividend amounts.
An investor studying sustainable growth may use ROE and payout ratio. This gives a growth estimate based on the calculator's formula.
For a future income estimate, the Future mode can compound a chosen growth rate over several years.
These examples use different modes because dividend growth can be measured in more than one way.
The Dividend Growth calculator gives four useful ways to study dividends. CAGR measures annualized growth. One-year mode measures a single change. Sustainable mode estimates growth from ROE and retention. Future mode compounds a chosen growth rate.
Choose the mode that fits your goal. Then enter the correct values and review the result before using it for investment analysis.
A Dividend Growth calculator measures or estimates dividend growth. This calculator offers CAGR, one-year, sustainable, and future dividend calculations.
It depends on the selected mode. CAGR uses the beginning dividend, ending dividend, and time period. One-year growth compares two dividend amounts.
You need different inputs for each mode. CAGR needs three values. One-year growth needs two. Sustainable growth needs ROE and payout ratio. Future dividend growth needs a current dividend, growth rate, and forecast period.
Yes. A dividend can fall from one period to the next. The one-year formula can therefore produce a negative growth rate. The future mode also accepts growth rates above -100%.
In this calculator, it is calculated from ROE and the retention ratio. The formula is ROE multiplied by the portion of earnings not paid as dividends.
The result is mathematically based on the values you enter. It doesn't predict what a company will actually pay. Future results depend on the growth assumption you use.
CAGR is annualized. Changing the time period changes the annual growth rate needed to move from the beginning dividend to the ending dividend.