CAGR — compound annual growth rate

What it measures¶

The compound annual growth rate is the constant yearly rate that would take a first value to a last value over a number of years: (last ÷ first)^(1 ÷ years) − 1. Revenue that grew from 100 to 133.1 over three years has a CAGR of 10%, because 100 × 1.1 × 1.1 × 1.1 = 133.1.

Why it is on the page¶

It is the honest average of growth over several years: it compounds the way money does, where a simple average of the yearly rates does not. The Fundamentals page states how many intervals it spans, because a CAGR over three years is a far weaker claim than one over ten. The condition summary prints the three-year CAGR of revenue and of diluted earnings per share in the Growth tile's sentence — and never counts either as a check.

Thresholds, their source and the population they were fitted on¶

The row draws no zones. Growth is described, not scored: multi-year growth rates persist little more than chance would produce (Chan, Karceski and Lakonishok, 2003).

• Fitted on: no population — a formula.
• Evidence grade: not graded.

A worked example¶

As the condition summary computed them on 25 October 2026, over the three years to fiscal 2025:

• Honeywell International — revenue 1.8% a year, diluted earnings per share 0.4% a year;
• Meta Platforms — revenue 19.9% a year, diluted earnings per share 39.8% a year.

What “No verdict” means here¶

The figure carries no verdict. It reads insufficient data when the first or last value of the window is missing — the page refuses the number rather than quietly shortening the window. It is not computed across a change from loss to profit, where the formula has no meaning.

What the verdict is and is not¶

The figure describes past growth as one steady rate. It hides the path — a fall and a recovery can share a CAGR with a steady climb. It is not a forecast and not an instruction to trade the shares.