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American International Group (AIG)
NYSE:AIG
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American International Group
(NYSE:AIG)
Rating:68Neutral
Price Target:
$93.00
▲(10.28%Upside)
Positive Factors
Expense Management
AIG's investor day presentation points to better expense ratios than consensus.
Financial Flexibility
Low leverage and excess capital provide flexibility for potential M&A deals and shareholder returns.
Growth and Innovation
Management is particularly optimistic about tech enabled growth in the specialty segment, such as Lexington Insurance.
Negative Factors
Capital Returns
The forecast for AIG's stock repurchase levels has been adjusted downward, indicating a reduction in capital returns.
Guidance Risk
There is greater risk at AIG due to the risk of it missing guidance.
Margin Pressure
Pricing-power within the large employer marketplace where AIG primarily operates continues to be 'soft,' possibly resulting in margin pressure.
American International Group (AIG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$50.34B
Dividend Yield1.88%
Average Volume (3M)3.54M
Price to Earnings (P/E)19.5
Beta (1Y)0.57
Revenue Growth-44.30%
EPS Growth-33.09%
CountryUS
Employees22,200
SectorFinancial
Sector Strength79
IndustryInsurance - Diversified
Share Statistics
EPS (TTM)1.17
Shares Outstanding576,330,260
10 Day Avg. Volume3,383,477
30 Day Avg. Volume3,544,203
Financial Highlights & Ratios
PEG Ratio0.25
Price to Book (P/B)1.25
Price to Sales (P/S)0.00
P/FCF Ratio11.84
Enterprise Value/Market Cap1.37
Enterprise Value/Revenue0.52
Enterprise Value/Gross Profit2.53
Enterprise Value/Ebitda2.47
Forecast
1Y Price Target
$90.21Price Target Upside6.97% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering14
American International Group Business Overview & Revenue Model
Company DescriptionAmerican International Group, Inc. (AIG) is a leading global insurance organization that provides a wide range of property casualty insurance, life insurance, retirement products, and other financial services to commercial, institutional, and individual customers. With operations in more than 80 countries and jurisdictions, AIG is known for its comprehensive risk management solutions and expertise in underwriting, claims, and customer service, catering to a diverse client base across various industries.
How the Company Makes MoneyAIG makes money primarily through the underwriting and sale of insurance and financial products. Its revenue streams include premiums from property and casualty insurance, which cover a variety of risks, including property damage, liability, commercial and personal insurance. In addition to this, AIG generates income from its life insurance and retirement products, which include annuities and investment products. The company also earns investment income from its portfolio of invested assets, which includes fixed income securities, equities, and alternative investments. Significant partnerships with brokers, agents, and financial institutions contribute to its distribution network and revenue generation. Furthermore, AIG's focus on risk management and claims services plays a crucial role in maintaining profitability by minimizing losses and optimizing claim outcomes.
American International Group Earnings Call Summary
Earnings Call Date:May 01, 2025
(Q1-2025)
| % Change Since: 4.32%|
Next Earnings Date:Jul 30, 2025
Earnings Call Sentiment Positive
AIG demonstrated strong financial performance in the first quarter with notable growth and strategic advancements, despite challenges from catastrophe losses and tariff-related uncertainties. The company made significant progress in expense management and AI adoption, supporting a strong overall outlook.Q1-2025 Updates
Positive Updates
Exceptional First Quarter Financial Performance
AIG reported an adjusted after-tax income of $702 million or $1.17 per diluted share. Net premiums written were $4.5 billion, an increase of 8% year-over-year, led by 10% growth in Global Commercial.
Strong Growth in North America Commercial Insurance
North America Commercial Insurance net premiums written grew 14% year-over-year. Lexington grew 23%, led by Lexington Casualty, which grew 27%.
Significant Improvement in Expense Ratios
The general insurance expense ratio decreased to 30.5% in the first quarter from 31.8% in the prior year quarter, with AIG Next initiatives contributing to a 20 basis point improvement.
Continued Progress on Strategic Initiatives
AIG is effectively managing volatility and has made substantial progress on strategic and financial objectives, including strong underwriting results and disciplined expense management.
Advancements in AI Strategy
AIG highlighted its strategy to deploy GenAI end-to-end, showcasing partnerships with Palantir and Anthropic to drive future growth.
Successful Capital Management
AIG returned $2.5 billion of capital to shareholders in the first quarter, including $2.2 billion in share repurchases and a 12.5% dividend increase.
Strong Performance in International Commercial
International Commercial Insurance net premiums written grew 8% year-over-year on an FX-adjusted basis, with Property growing 35% and Marine 17%.
Negative Updates
Impact of Catastrophe Losses
The first quarter included $520 million in catastrophe losses, driven by the California wildfires at $460 million, resulting in a combined ratio of 95.8%.
Uncertainty from Tariffs and Inflation
There is significant uncertainty around the impact of tariffs and inflation on future loss costs, which may affect transactional activity and create further challenges.
Pressure on Financial Lines
Financial Lines experienced a decrease in pricing, with public D&O rates showing signs of improvement but still facing challenges.
Challenges in Property Pricing
Property pricing faced headwinds with decreases noted in Financial Lines, Retail Property, and Lexington Property.
Company Guidance
During AIG's Q1 2025 Financial Results Conference Call, substantial guidance was provided on the company's financial performance and strategic direction. AIG reported an adjusted after-tax income of $702 million or $1.17 per diluted share, with net premiums written at $4.5 billion, marking an 8% increase year-over-year, largely driven by a 10% growth in Global Commercial. The General Insurance expense ratio improved to 30.5% from 31.8% in the prior year, attributed mainly to the divestiture of the travel business. The accident year combined ratio, as adjusted, was 87.8%, the best first quarter result since the financial crisis, while the calendar year combined ratio was 95.8%, including $520 million in catastrophe losses. Additionally, AIG returned $2.5 billion of capital to shareholders, including $2.2 billion in share repurchases, and ended the quarter with a debt-to-total capital ratio of 17.1%. The call highlighted AIG's strategic initiatives, such as the integration of GenAI to drive growth, with endorsements from partners at Palantir and Anthropic. The company also emphasized its disciplined capital management strategy, including a share repurchase authorization of $7.5 billion and a 12.5% increase in quarterly dividends. AIG's strategic focus extends internationally, particularly in the rapidly growing Indian market through its joint venture with Tata Group. Despite challenges such as tariffs and geopolitical uncertainties, AIG remains committed to its long-term financial targets, including achieving a 10%-plus core operating ROE by 2025 and a 20%-plus EPS compound annual growth rate over the next three years.American International Group Financial Statement Overview
Summary
AIG is facing significant financial challenges, with declining revenue, net losses, and increased leverage. Despite maintaining positive cash flow, these negative trends pose risks to financial stability.Income Statement
The income statement shows a concerning trend with declining revenue over the years, particularly noticeable in the TTM (Trailing-Twelve-Months) period. The gross profit margin has been stable, but the company reported a net loss in both the TTM and 2024, indicating challenges in controlling costs or generating sufficient revenue. EBIT and EBITDA margins have also seen fluctuations, reflecting operational inefficiencies.45
Neutral
Balance Sheet
The balance sheet indicates moderate financial health with a stable equity ratio, suggesting some level of stability. However, the debt-to-equity ratio has increased, indicating rising leverage that could pose risk if not managed cautiously. Return on Equity (ROE) is negative in the TTM period due to net losses, which is a concern for shareholders.55
Neutral
Cash Flow
Cash flow analysis shows positive operating cash flow in the TTM period, although lower than previous years. The company has managed to maintain free cash flow despite challenges, but the free cash flow growth rate is negative, and the operating cash flow to net income ratio reflects the impact of net losses on cash generation.60
Neutral
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 27.27B | 27.27B | 47.25B | 54.77B | 51.96B | 43.84B | Gross Profit |
| 27.27B | 27.27B | 47.25B | 47.24B | 43.27B | 35.34B | EBIT |
| 3.63B | 3.87B | 3.88B | 16.38B | 13.35B | -5.83B | EBITDA |
| 7.54B | 7.47B | 8.07B | 18.71B | 17.89B | -3.17B | Net Income Common Stockholders |
| -1.92B | -1.40B | 3.64B | 10.23B | 10.37B | -5.94B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 267.17B | 15.76B | 2.15B | 240.57B | 292.76B | 292.53B | Total Assets |
| 525.06B | 161.32B | 539.31B | 522.23B | 596.11B | 586.48B | Total Debt |
| 35.35B | 8.92B | 22.39B | 27.18B | 30.16B | 37.53B | Net Debt |
| 32.49B | 7.62B | 20.23B | 25.14B | 27.96B | 34.71B | Total Liabilities |
| 457.64B | 118.77B | 488.00B | 478.77B | 527.20B | 519.28B | Stockholders Equity |
| 65.67B | 42.52B | 45.35B | 40.97B | 65.96B | 66.36B |
| Cash Flow | Free Cash Flow | ||||
| 2.70B | 3.27B | 6.24B | 4.13B | 6.22B | 1.04B | Operating Cash Flow |
| 2.70B | 3.27B | 6.24B | 4.13B | 6.22B | 1.04B | Investing Cash Flow |
| 4.12B | 1.67B | -7.02B | -3.63B | -3.28B | -6.20B | Financing Cash Flow |
| -6.60B | -5.06B | 782.00M | -602.00M | -3.68B | 5.06B |
American International Group Technical Analysis
Positive
84.33
Price Trends
82.91
Positive
80.57
Positive
77.21
Positive
Market Momentum
0.82
Negative
51.82
Neutral
62.29
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AIG, the sentiment is Positive. The current price of 84.33 is above the 20-day moving average (MA) of 84.03, above the 50-day MA of 82.91, and above the 200-day MA of 77.21, indicating a bullish trend. The MACD of 0.82 indicates Negative momentum. The RSI at 51.82 is Neutral, neither overbought nor oversold. The STOCH value of 62.29 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AIG.
American International Group Risk Analysis
American International Group disclosed 36 risk factors in its most recent earnings report. American International Group reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
American International Group Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $36.74B | 12.89 | 18.49% | 1.56% | 7.55% | 14.16% | |
73 Outperform | $17.21B | 16.45 | 9.70% | 3.79% | 5.84% | -10.64% | |
73 Outperform | $35.80B | 9.47 | 18.42% | ― | 25.29% | -23.19% | |
71 Outperform | $16.66B | 14.90 | 56.67% | 1.76% | 12.41% | 14.76% | |
70 Neutral | $11.23B | 15.97 | 9.36% | 4.09% | -5.03% | ― | |
68 Neutral | $50.34B | 19.51 | 6.13% | 1.88% | -44.30% | -33.09% | |
64 Neutral | $12.83B | 9.78 | 7.78% | 16985.64% | 12.26% | -7.81% |
* Financial Sector Average
Performance Comparison
AIG
American International Group
84.33
11.68
16.08%
AEG
Aegon
7.21
1.29
21.79%
ACGL
Arch Capital Group
89.77
-4.92
-5.20%
HIG
Hartford Financial
124.90
27.12
27.74%
PFG
Principal Financial
76.76
1.84
2.46%
EQH
Equitable Holdings
54.68
14.97
37.70%
American International Group Corporate Events
Private Placements and FinancingBusiness Operations and Strategy
AIG Upsizes Cash Tender Offers for Debt Management
Positive
Jun 9, 2025
On June 6, 2025, AIG announced the pricing terms for its cash tender offers to purchase certain outstanding notes, with a total consideration capped at $300 million. By June 9, 2025, AIG reported the results and upsizing of these offers, indicating a strategic move to manage its debt obligations and potentially improve its financial flexibility.
The most recent analyst rating on (AIG) stock is a Buy with a $87.00 price target. To see the full list of analyst forecasts on American International Group stock, see the AIG Stock Forecast page.
Private Placements and FinancingBusiness Operations and Strategy
AIG Initiates Cash Tender Offers for Notes
Positive
Jun 2, 2025
On June 2, 2025, American International Group, Inc. announced the initiation of cash tender offers for ten series of its outstanding notes, aiming to purchase up to $300 million in total consideration. This move is part of AIG’s strategic financial management, potentially impacting its debt structure and providing liquidity to noteholders, while also reflecting its ongoing efforts to optimize its capital allocation and strengthen its financial position.
The most recent analyst rating on (AIG) stock is a Buy with a $87.00 price target. To see the full list of analyst forecasts on American International Group stock, see the AIG Stock Forecast page.
Executive/Board ChangesShareholder Meetings
AIG Shareholders Approve Key Proposals at Annual Meeting
Neutral
May 16, 2025
On May 14, 2025, AIG held its Annual Meeting of Shareholders where several key proposals were voted on. The election of directors resulted in the appointment of various individuals to the Board until the 2026 Annual Meeting. Additionally, shareholders approved the continuation of annual Say-on-Pay Votes, aligning with the Board’s recommendation, and ratified the appointment of PricewaterhouseCoopers LLP as the independent auditor for 2025.
The most recent analyst rating on (AIG) stock is a Buy with a $90.00 price target. To see the full list of analyst forecasts on American International Group stock, see the AIG Stock Forecast page.
Private Placements and FinancingBusiness Operations and Strategy
AIG Announces Redemption of 3.900% Notes Due 2026
Neutral
May 15, 2025
On May 15, 2025, American International Group, Inc. announced its decision to redeem all outstanding 3.900% Notes due 2026 on June 26, 2025. The redemption will involve paying the registered holders the principal amount, accrued interest, and a ‘make-whole’ premium. As of the announcement date, $236,160,000 of these notes were outstanding. This move is part of AIG’s financial strategy, potentially impacting its debt structure and stakeholder interests.
The most recent analyst rating on (AIG) stock is a Buy with a $90.00 price target. To see the full list of analyst forecasts on American International Group stock, see the AIG Stock Forecast page.
Private Placements and FinancingBusiness Operations and Strategy
AIG Completes $1.25 Billion Notes Sale
Positive
May 7, 2025
On May 7, 2025, AIG successfully completed the sale of $1.25 billion in aggregate principal amount of notes, consisting of $625 million of 4.850% Notes due 2030 and $625 million of 5.450% Notes due 2035. This strategic financial move is expected to bolster AIG’s financial position and potentially enhance its market competitiveness, offering implications for stakeholders regarding the company’s financial strategy and future growth prospects.
Stock BuybackBusiness Operations and Strategy
AIG Announces $7.5 Billion Share Repurchase Plan
Positive
Mar 31, 2025
On March 31, 2025, American International Group hosted its 2025 Investor Day, where it announced a new share repurchase authorization of up to $7.5 billion, effective April 1, 2025. This move reflects AIG’s strategic focus on enhancing shareholder value and signifies its confidence in its financial position and future growth prospects.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.