The South Co. has 14,086,685 Shares outstanding. It just paid a dividend of $3.24. It plans to grow its dividends 3.1% annually forever. The required rate of return is 13%. Using the dividend growth model, what is the total equity value of South? (Round to a whole number)

The South Co. has 14,086,685 Shares outstanding. It just paid a dividend of $3.24. It plans to grow its dividends 3.1% annually forever. The required rate of return is 13%. Using the dividend growth model, what is the total equity value of South? (Round to a whole number)

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Question

The South Co. has 14,086,685 Shares outstanding. It just paid a dividend of $3.24. It
plans to grow its dividends 3.1% annually forever. The required rate of return is 13%.
Using the dividend growth model, what is the total equity value of South? (Round to a
whole number)

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