Dividend Growth Calculator
Explore the dividend attached to one share. Compare its growth with the share price, with an optional maximum projected yield.
Per-share assumptions
Calculated locally from your assumptions.
Projected yield on price: 6.52% at a share price of $50.
Reading this result
- What it shows
- The annual dividend on one share at the end of the period if it grew at your rate every year. Projected yield divides that dividend by the projected share price.
- What changes it
- Starting dividend, dividend growth rate and years. Share-price growth changes the projected yield; the optional yield cap can also limit the dividend.
- Not included
- Dividend cuts or pauses, changes to the growth rate over time, tax, and inflation. Amounts are in nominal dollars.
Dividend per share over 10 years
View as table
| Year | Annual dividend / share |
|---|---|
| 1 | $2.1 |
| 2 | $2.21 |
| 3 | $2.32 |
| 4 | $2.43 |
| 5 | $2.55 |
| 6 | $2.68 |
| 7 | $2.81 |
| 8 | $2.95 |
| 9 | $3.1 |
| 10 | $3.26 |
| Year | Share price | Annual dividend / share | Projected yield |
|---|---|---|---|
| 1 | $50 | $2.1 | 4.2% |
| 2 | $50 | $2.21 | 4.41% |
| 3 | $50 | $2.32 | 4.63% |
| 4 | $50 | $2.43 | 4.86% |
| 5 | $50 | $2.55 | 5.11% |
| 6 | $50 | $2.68 | 5.36% |
| 7 | $50 | $2.81 | 5.63% |
| 8 | $50 | $2.95 | 5.91% |
| 9 | $50 | $3.1 | 6.21% |
| 10 | $50 | $3.26 | 6.52% |
Educational estimates from your inputs. Dividends, prices, and taxes can change. Not investment advice or guaranteed income.
The formula
Uncapped annual dividend after N years = starting annual dividend × (1 + annual growth rate)^N. Effective dividend = min(raw dividend, price × cap) when a cap is enabled.
Calculation conventions and limitationsA worked example
A $2 annual dividend growing 5% each year becomes about $3.26 after ten years. If a $50 share price stays constant, the uncapped yield becomes about 6.52%. Neither increase is guaranteed.
What dividend growth rate should you assume?
The rate is your assumption, applied every year without variation. A common starting point is a dividend’s past growth, checked over more than one period because a single strong year can overstate the trend.
Trying a lower and a higher rate shows how much the result depends on it. Starting from $2 for ten years, 3% a year gives about $2.69, 5% about $3.26, and 7% about $3.93.
How does the calculator apply growth?
Dividend per share and share price each grow every month at the rate that compounds to your annual figure, so 5% a year means 5% after twelve months. The two rates are independent: when the dividend grows faster than the price, the projected yield rises.
The optional yield cap limits the dividend to a maximum percentage of the price. Without a cap, projected yields above 15% are flagged for review.
Is dividend growth keeping up with inflation?
Only growth above inflation increases what the dividend can buy. This calculator shows nominal dollars, so compare the two rates: real growth = (1 + dividend growth) ÷ (1 + inflation) − 1. At 5% dividend growth and 2.5% inflation, that is about 2.44% a year, and the $3.26 dividend after ten years is worth about $2.54 in today’s dollars.
The full Dividend Calculator makes the same adjustment to portfolio value when you enter an inflation rate.
See portfolio value in today’s dollars with the full Dividend CalculatorWhy doesn’t past dividend growth guarantee future increases?
A record of increases describes what was paid, not a commitment. Dividends can be held flat, reduced or suspended as a company’s earnings, cash needs and priorities change, and a long streak can end.
The calculator applies one constant rate, so it cannot show a cut in a particular year. Treat the result as one path among many, and compare it with lower rates.
Dividend Growth Calculator questions
What is a dividend growth rate?
The yearly percentage change in the dividend per share. A dividend that rises from $2.00 to $2.10 in a year has grown 5%.
Can I model a dividend cut?
Not as a single event. A negative growth rate, down to −50% a year, models a steady decline instead.