1. Pam Robers, CFA, is performing a valuation analysis on the common stock of Allstare Inc. The stock's beta is 1.1, the risk-free rate is 5%, and the market risk premium is expected to be 8%. Allstare's ROE is expected to be constant at 18%, and its dividend payout ratio has been fairly constant over time at 40%. The forward-earnings multiplier that Robers should use to estimate the current value of the shares is closest to: