AIG - American International: Business Is Simplifying But Shares Appear Fully Valued
2024-06-18 22:35:02 ET
Summary
- AIG shares have gained 31% in the past year but have declined 8% from recent highs and underperformed in recent months.
- AIG has simplified its business by deconsolidating CRBG results, focusing on its general insurance business, and successfully maximizing value from stake sales.
- AIG continues to return capital to shareholders through buybacks and dividend increases, with improving underwriting results and investment income.
- At 12x core earnings and with growth likely to slow from here, shares reflect the benefits of its transformation.
Shares of American International Group ( AIG ) have been a strong performer over the past year, gaining about 31%. However, shares have declined about 8% from recent highs. I last covered AIG in January , when I downgraded shares to a “hold,” and since that recommendation, shares have underperformed, returning 12% vs the S&P 500’s 15% gain. Recently, the company passed a significant milestone in its simplification effort, as it will no longer consolidate Corebridge ( CRBG ) results starting in Q2, making now a natural time to re-evaluate AIG shares. I view shares as fully valued and would not add....
American International: Business Is Simplifying, But Shares Appear Fully Valued