MCPCalc

Dividend Reinvestment (DRIP) Calculator

Calculate the growth of an investment with dividend reinvestment and dividend growth.

Scratchpad (not saved)

$

Starting investment amount

$

Current price per share

%

Current annual dividend yield

%

Expected annual dividend growth rate

%

Expected annual share price appreciation

years

Investment time horizon

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What This Calculator Does

Estimate compounding impact from reinvesting dividends and increasing share count over multi-year investment horizons.

It combines Initial Investment, Current Share Price, Annual Dividend Yield, Annual Dividend Growth Rate to estimate Final Portfolio Value, Total Return, Annualized Return.

Formula & Method

Core equations: Each year dividends buy new shares: New Shares=Shares×P×YdP\text{New Shares} = \frac{\text{Shares} \times P \times Y_d}{P} where PP is the current share price and YdY_d is the dividend yield. Share price grows annually: Pt+1=Pt(1+gp)P_{t+1} = P_t(1 + g_p). Annualized return: r=(VfinalVinitial)1/t−1r = \left(\frac{V_{final}}{V_{initial}}\right)^{1/t} - 1 Inputs are applied in base units, then derived metrics are computed from the same equations and rounded for display.

Notation used in the formulas: RR = Final Portfolio Value; x1x_{1} = Initial Investment; x2x_{2} = Current Share Price; x3x_{3} = Annual Dividend Yield; x4x_{4} = Annual Dividend Growth Rate; x5x_{5} = Annual Share Price Growth; x6x_{6} = Holding Period.

Method summary: inputs are normalized to consistent units, core equations are evaluated, then secondary values are derived and rounded for display.

Use this to compare income-focused strategies and evaluate long-run reinvestment effects on total return.

Reference Book

Mathematics of Investment and Credit

Samuel A. Broverman · ACTEX Learning

A widely used text for time-value-of-money, annuity, loan, amortization, and bond calculations.

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Inputs Used

  • Initial Investment: Starting investment amount
  • Current Share Price: Current price per share
  • Annual Dividend Yield: Current annual dividend yield
  • Annual Dividend Growth Rate: Expected annual dividend growth rate
  • Annual Share Price Growth: Expected annual share price appreciation
  • Holding Period: Investment time horizon

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