Intrinsic Value Calculation using Residual Income Model

A company known as XYZ Corp has reported the following financial information for the year ending December 31, 2022:

- Book Value of Equity at the start of the year: $500 million

- Earnings per Share (EPS): $5

- Required Rate of Return: 10%

- Expected Growth Rate of Earnings: 5%

Using the Residual Income Model (RIM), calculate the intrinsic value of equity per share and determine which of the following statements about XYZ Corp is true based on your calculation.