The measure, which values a stock as the sum of all its future dividends, shows equities are still overpriced. With S&P 500 companies projected to pay a combined $25.27 in dividends this year, the index would need to fall to 526.46 before investors are compensated for owning shares. 2008 Slump The analysis assumes investors expect total returns of 6 percent annually from stocks, including a 1.2 percent increase in dividends, which is the historical average since 1900, adjusted for inflation, according to data from the London Business School. The S&P 500 has declined 18 percent so far this year, after slumping 38 percent in 2008. Treasury notes and bonds of all maturities returned 14 percent last year, according to data compiled by Merrill Lynch & Co. “Bearing in mind the higher risk, equities obviously become less attractive if the dividend decreases,” said Jörg Boysen, who manages a global equities fund at Frankfurt-based Union Investment, which oversees $182 billion