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American International Group Inc AIG

Morningstar Rating
$72.84 −0.05 (0.07%)
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Company Report

AIG Earnings: Improved Underwriting Leads to an Acceptable Return

AIG delivered a solid finish to the year. Adjusted tangible return on equity was 10% for both the fourth quarter and the full year, suggesting AIG has now reached a point where the company is generating acceptable returns. We remain encouraged by the improvement in property and casualty, or P&C, underwriting results, which we see as the most critical factor in maintaining acceptable returns over time. We will maintain our $68 per share fair value estimate for the no-moat company and see the shares as fairly valued at the moment.

Price vs Fair Value

AIG is trading within a range we consider fairly valued.
Price
$72.84
Fair Value
$95.00
Uncertainty
Medium
1-Star Price
$73.60
5-Star Price
$86.80
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

The aftermath of AIG's issues during the financial crisis occupied management's attention for quite some time. With these issues now resolved, there could be ample scope for improvement.

Bears

AIG has a history of under-reserving for claims, making it difficult to trust that current reserves are adequate.

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News

Trading Information

Previous Close Price
$72.89
Day Range
$72.4773.44
52-Week Range
$45.6673.44
Bid/Ask
$71.01 / $74.95
Market Cap
$49.60 Bil
Volume/Avg
4.4 Mil / 3.9 Mil

Key Statistics

Price/Earnings (Normalized)
10.74
Price/Sales
1.12
Dividend Yield (Trailing)
1.92%
Dividend Yield (Forward)
1.98%
Total Yield
7.89%

Company Profile

American International Group is one of the largest insurance and financial services firms in the world and has a global footprint. It operates through a wide range of subsidiaries that provide property, casualty, and life insurance. The company recently spun off its life insurance operations (Corebridge), but still retains a majority stake.
Sector
Financial Services
Industry
Insurance - Diversified
Stock Style Box
Mid Value
Total Number of Employees
25,200

Competitors

Valuation

Metric
AIG
CB
TRV
Price/Earnings (Normalized)
10.7411.1017.89
Price/Book Value
1.121.712.00
Price/Sales
1.122.081.23
Price/Cash Flow
5.4010.014.90
Price/Earnings
AIG
CB
TRV

Financial Strength

Metric
AIG
CB
TRV
Quick Ratio
Current Ratio
Interest Coverage
4.4015.189.97
Quick Ratio
No chart available

Profitability

Metric
AIG
CB
TRV
Return on Assets (Normalized)
0.93%4.29%2.55%
Return on Equity (Normalized)
11.71%16.92%13.79%
Return on Invested Capital (Normalized)
2.49%13.22%11.35%
Return on Assets
AIG
CB
TRV
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Insurance - Diversified Industry Comparables

Ticker
Name
Morningstar Rating for Stocks
Economic Moat
Market Cap
BRK.A
Berkshire Hathaway Inc Class ASngt$881.5 Bil
BRK.B
Berkshire Hathaway Inc Class BBskp$881.5 Bil
ALIZY
Allianz SE ADRZbtx$106.8 Bil
AXAHY
AXA SA ADRJgry$78.3 Bil
ZURVY
Zurich Insurance Group AG ADRCcgptj$76.0 Bil
SLF
Sun Life Financial IncTfcpf$31.2 Bil
AVVIY
Aviva PLC ADRTcvj$15.5 Bil
AEG
Aegon Ltd ADRXsvts$10.0 Bil
AGESY
Ageas SA/ NV ADRXhk$7.7 Bil

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