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    nemo2010's Avatar
    nemo2010 Posts: 1, Reputation: 1
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    #1

    Oct 5, 2010, 07:45 PM
    How do I calculate sustainable growth if my anticipated sales growth is 35%?
    My anticipated profit margin is 27.1 %, my assets to equity ratio is 2.55 and asset turnover rate is 0.68.
    ArcSine's Avatar
    ArcSine Posts: 969, Reputation: 106
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    #2

    Oct 7, 2010, 05:02 AM
    You've got three of the four necessary ingredients. The SGR is simply the product of four variables... the three you've named, along with the retention rate (the percentage of net earnings reinvested in the biz; plowed back; not distributed as dividends; however you want to say it).

    Multiply the four factors to get SGR.
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