Nestle's latest dividend is RM 2.50/share and your required rate of return is 10%. Nestles' share price
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Question:
- Nestle's latest dividend is RM 2.50/share and your required rate of return is 10%. Nestles' share price is currently selling at RM 52.50
- (i)Calculate the growth in dividend that Nestle must achieve indefinitely in order to meet the investor's required rate of return.
- (ii)Calculate the intrinsic value of the share if you increase your required rate of return to 35% and growth in dividend is increased to 25%.
side question - does latest dividend mean that dividend was in time 0? in other words it is Div_0 or Div_1?
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