What it is
The annualised rate at which earnings per share grew over the trailing 5 years. EPS at $4 today vs. $2 five years ago = 14.9% CAGR.Why per-share matters
A company can grow total earnings 10% per year while diluting shareholders 8% per year through stock-based comp and acquisitions - leaving you with 2% per-share growth despite the headline.Buffett: "We're not interested in companies that grow earnings by selling more shares." Per-share figures cut through that.
What "good" looks like
- 15%+: exceptional. Compounds wealth fast (at 15%, $1 doubles in ~5 years)
- 8–15%: solid quality compounders
- 3–8%: market-average growth, depends on price paid
- < 3% or negative: declining business, only attractive at deep discounts