Sustainable growth combines profitability on equity with the share of earnings retained.
Sustainable Growth Rate Calculator
Form
Results
ROE
0
SGR
0
Table of Contents
1
What is Sustainable Growth Rate?
2
How to Use This Calculator
- Enter or select Net income, Dividends paid, Total shareholder's equity.
- Check the unit beside each measurement. For a percentage or rate, use the scale and time period stated in the form.
- Choose Calculate, then compare the output with the formula and example below. If you change a value or option, calculate again to update the result.
3
Formula Used
Growth rate = ROE × retention ratio
4
Variables Explained
| Input | What it means |
|---|---|
| Net income | Earnings after the relevant expenses, interest and taxes for the reporting period. |
| Dividends paid | The distribution paid to shareholders for the same period as the earnings figure. |
| Total shareholder's equity | The shareholder funding or residual ownership value used in the selected ratio. |
5
Worked Example
ROE of 12% and retention of 75% imply growth of 9% under the model.
6
Why Use This Calculator?
Compare the result with the underlying statement, budget or proposed transaction. It is most useful when every amount uses the same reporting period and the same accounting definition.
7
Common Mistakes
- This assumes financing and operating relationships stay stable; it is not a guaranteed growth forecast.
8
Frequently Asked Questions
Should I use monthly or annual figures?
Use one consistent period for every amount and rate in the relationship. If a form specifies an annual rate or a monthly amount, follow that label rather than mixing time periods.
Does the result include fees and tax?
Only the costs and taxes represented by the inputs and formula are included. A real transaction can include other charges, so compare the estimate with the underlying agreement or statement.
9
Sources & References
Mini Calculator provides online calculators for multiple niches including mathematical, financial, Health, informative, Chemistry, physics, statistics, and conversions. You can use any calculator for free without any limits.