HOMEPAGE

Dividend Growth

Definition

Dividend Growth measures the annual percentage increase in a company’s dividend payments.

$$\text{Dividend Growth}=\frac{\text{Current Dividend}-\text{Prior Dividend}}{\text{Prior Dividend}}$$

Why It Matters

• Indicates financial strength and shareholder commitment.
• Key input for dividend‑discount valuation models.
• Consistent growth signals stable cash flow.

Example

Dividend last year = $1.00 Dividend this year = $1.10

$$\text{Dividend Growth}=\frac{1.10-1.00}{1.00}=10\mathrm{\%}$$