Select Page
QuestionsCategory: MiscellaneousWhat is the acceptable range of growth stock’s CAGR?
Yong asked 2 years ago

Hi, normally what is the acceptable/expected CAGR/IRR range for investing in a growth type of equity?

Yong replied 2 years ago

And would you take into consideration Equity Multiply to figure out whether we have made a good investment decision (after bought)? If yes, what kind of range would be your expected? this is aside from the valuation method we’ve learnt.

3 Answers
Chor Loo answered 2 years ago

Just my thoughts…comparison should be made against its peers, whether its growth is exceeding that of its peers. Other areas would be based on market share. Right decision can then be validated if it has the highest growth rate n gaining market share. 

Jieren Zheng answered 2 years ago

If I am not wrong, for Investment Quadrant, which the focus are buying proven companies with more growth runway (Value Growth), the annual growth rate is ranging from 5-25%.

Pure growth counters would be probably higher at 25-50% annual growth rate I guess.

Victor Chng answered 2 years ago

Personally, I think if you want invest in growth, minimum should achieve at least 10%. The rest is a bonus.