Surf & Turf Hotels is a mature business, although it pays no cash dividends. Next year's earnings are forecasted at $$74$ million. There

are $10$ million outstanding shares. The company has traditionally paid out $50\%$ of earnings by repurchases and reinvested the

remaining earnings. With reinvestment, the company has generated steady growth averaging $5\%$ per year. Assume the cost of equity

is $14\%.$

a$.$ Calculate Surf & Turf $\text{'}$s current stock price using the constant$-$growth DCF model.

b$.$ Now Surf & Turf's CFO announces a switch from repurchases to a regular cash dividend. Next year's dividend will be $$3\mathrm{.}70$ per

share. The CFO reassures investors that the company will continue to pay out $50\%$ of earnings and reinvest $50\%.$ All future

payouts will come as dividends, however. What would be Surf & Turf $\text{'}$s stock price?

Note: For all requirements, do not round intermediate calculations. Round your answers to $2$ decimal places.Surf & Turf Hotels is a mature business, although it pays no cash dividends. Next year$$s earnings are forecasted at $$74$ million. There are $10$ million outstanding shares. The company has traditionally paid out $50\%$ of earnings by repurchases and reinvested the remaining earnings. With reinvestment, the company has generated steady growth averaging $5\%$ per year. Assume the cost of equity is $14\%.$

Calculate Surf & Turf $$s current stock price using the constant$-$growth DCF model.

Now Surf & Turf's CFO announces a switch from repurchases to a regular cash dividend. Next year$$s dividend will be $$3\mathrm{.}70$ per share. The CFO reassures investors that the company will continue to pay out $50\%$ of earnings and reinvest $50\%.$ All future payouts will come as dividends, however. What would be Surf & Turf $$s stock price?

Note: For all requirements, do not round intermediate calculations. Round your answers to $2$ decimal places.