🌱 Sustainable Growth Rate Calculator
Calculate the maximum growth rate a company can sustain without raising additional equity financing.
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Sustainable Growth Rate Formula
SGR = ROE × Retention Ratio
= ROE × (1 − Payout Ratio)
= ROE × (1 − Payout Ratio)
If a company grows faster than its SGR, it will need to raise debt or equity. Growing slower than SGR means cash piling up (or paying more dividends). The SGR is a natural speed limit for self-financed growth.
Sustainable Growth RateSGRROEPlowback RatioDividend Policy