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Definitions from the Web

CAGR

Description:

CAGR stands for Compound Annual Growth Rate. It is a financial metric that measures the average rate at which an investment or business has grown over a specific period of time, accounting for compounding effects.

Senses:

Sense 1 (Noun):

The CAGR is commonly used by investors and analysts to evaluate the performance of an investment or business, as it provides a more accurate representation of growth over multiple periods than a simple average.

Example sentence: The CAGR of the company's stock over the past five years was an impressive 12%, indicating strong growth.

Sense 2 (Verb):

In the context of financial analysis, to calculate the CAGR of an investment, you need to determine the initial and final value of the investment and the time period under consideration.

Example sentence: By using the CAGR formula, we can determine the growth rate of the investment over the past decade.

Usages:

Usage 1: Popular:

The CAGR is widely used in finance and investment sectors to assess the growth of various assets and businesses.

Example sentence: Many investors prefer to invest in companies with a high CAGR, as it indicates the potential for significant returns.

Usage 2: Local:

In local business communities, CAGR is utilized to analyze the growth trends of small businesses and startups.

Example sentence: The local entrepreneur was proud to announce that her business had experienced a CAGR of 20% over the past year.

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