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GrowthOpEx Ratio#88

Revenue CAGR 5Y

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Revenue CAGR 5Y expresses the rate at which the business is expanding. Value investors to size durable revenue and free cash flow expansion when Revenue CAGR 5Y aligns with the rest of the VMCI 1.

Javier Sanz, Founder & Lead Analyst at ValueMarkers
By , Founder & Lead AnalystEditorially reviewed
Last updated: Reviewed by: Javier Sanz

Formula

Total Operating Expenses / Revenue

Description

The total operating cost per dollar of revenue. This is a comprehensive efficiency measure that includes COGS, SGA, R&D, and other operating costs. A ratio below 1.0 means the company is operationally profitable before interest and taxes.

Interpretation

Below 0.8 indicates a 20%+ operating margin, which is strong. Above 1.0 means the company is not covering its operating costs with revenue. The trend is as important as the level. Declining OpEx ratio indicates improving efficiency.

Related metrics: Revenue Growth 1Y, Revenue CAGR 3Y. (Updated 2026)

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Further Reading

FAQ

How is Revenue CAGR 5Y calculated?+
Revenue CAGR 5Y uses the formula: Total Operating Expenses / Revenue. Long compounders sustain 15%+ revenue CAGR over 5+ years. ValueMarkers refreshes the calculation within 24 hours of each new SEC filing using Multi-year SEC filings + Damodaran growth-rate datasets.
What is a good Revenue CAGR 5Y value by sector?+
There is no single 'good' value for Revenue CAGR 5Y — context is sector-driven. Long compounders sustain 15%+ revenue CAGR over 5+ years. The /screener exposes sector-relative percentiles for Revenue CAGR 5Y on every ticker, so you can compare against the sector median rather than the broad-market median.
Which investors use Revenue CAGR 5Y?+
Peter Lynch, Philip Fisher, Bill Miller cite Revenue CAGR 5Y as a key input to to size durable revenue and free cash flow expansion. The academic anchor is Mauboussin's 'measuring the moat' framework. ValueMarkers weights this within the Growth pillar of the VMCI score (12% of total).
What are the limitations of Revenue CAGR 5Y?+
Revenue CAGR 5Y can mislead in high growth at unsustainable unit economics (cash-burn traps). Pair Revenue CAGR 5Y with at least two cross-checks from other VMCI pillars — for example, free cash flow trend, balance-sheet quality, and earnings consistency — before drawing a single-metric conclusion.
Where can I see live Revenue CAGR 5Y data?+
Visit any /stock/[ticker] page on ValueMarkers to see live Revenue CAGR 5Y data, sector percentiles, and the VMCI composite score that integrates Revenue CAGR 5Y with 119 other indicators across 100,000+ stocks. The free /screener exposes Revenue CAGR 5Y as a filterable column.

Related Growth Indicators

Revenue Growth 1YSGA/Rev

Revenue Growth 1Y measures the rate at which the business is expanding. Value investors to size durable revenue and free cash flow expansion when Revenue Growth 1Y aligns with the rest of the VMC.

Revenue CAGR 3YR&D/Rev

Revenue CAGR 3Y expresses the rate at which the business is expanding. Value investors to size durable revenue and free cash flow expansion when Revenue CAGR 3Y aligns with the rest of the VMCI 1.

EPS Growth 1YRev/Employee

EPS Growth 1Y expresses the rate at which the business is expanding. Value investors to size durable revenue and free cash flow expansion when EPS Growth 1Y aligns with the rest of the VMCI 120-i.

EPS CAGR 3YPay TO

EPS CAGR 3Y is the metric used to the rate at which the business is expanding. Value investors to size durable revenue and free cash flow expansion when EPS CAGR 3Y aligns with the rest of the VM.

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