In a report released yesterday, Bob Huang from Morgan Stanley maintained a Hold rating on American International Group (AIG – Research Report), with a price target of $76.00.
Bob Huang has given his Hold rating due to a combination of factors that reflect both the potential and the challenges facing American International Group (AIG). The company has demonstrated a successful turnaround, transitioning from a struggling underwriter to a more robust platform poised to exceed expectations in earnings per share growth and return on equity over the coming years. This progress is attributed to disciplined expense management, growth in excess and surplus lines, and improvements in loss ratios within its Global Personal Insurance segment.
Despite these positive developments, Huang’s Hold rating suggests a cautious stance, likely due to the need for AIG to fully realize its technology-driven growth strategies. The company has made significant strides in technology adoption, such as increasing cloud usage and modernizing its data infrastructure, which are expected to enhance efficiency and support long-term growth. However, the realization of these benefits and the achievement of the projected 10-13% return on equity will depend on successful execution in areas like underwriting income improvements, expense optimization, and strategic capital allocation, including share repurchases.
In another report released yesterday, Wells Fargo also maintained a Hold rating on the stock with a $82.00 price target.
Based on the recent corporate insider activity of 52 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of AIG in relation to earlier this year.