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American International Group, Inc. (AIG), worth a market cap of $48.5 billion, is a New York-based global insurance leader. The company delivers an extensive portfolio of insurance and financial services, including property casualty insurance, life insurance, and retirement solutions, through a robust multichannel distribution network.
Shares of AIG have underperformed the broader market over the past 52 weeks. AIG has surged 20.5% over this time frame, while the broader S&P 500 Index ($SPX) has rallied 35.8%. In 2024, AIG saw a YTD uptick of 13.7%, lagging behind the SPX's 24.3% rise.
Zooming in further, AIG has also trailed the US Insurance iShares ETF (IAK), which has delivered a robust 37.7% return over the past year and a 31.1% gain on a YTD basis.
On Nov. 4, AIG announced its Q3 earnings results, and its shares rose marginally. It reported adjusted earnings of $1.23 per share, surpassing Wall Street's expectation of $1.13 per share. The insurer posted general insurance net premiums written of $6.4 billion. It concluded the quarter with an excellent total debt-to-capital ratio of 17.9% and parent liquidity of $4.2 billion.
For the current fiscal year, ending in December, analysts expect AIG's EPS to decline 26.5% year over year to $4.99. The company's earnings surprise history is mixed. It exceeded the consensus forecast in three of the past four quarters while missing on one occasion.
Out of the 18 analysts assessing AIG stock, the consensus rating is "Moderate Buy." That's based on 10 "Strong Buy" ratings, two "Moderate Buys," and six "Holds.”
This configuration is slightly more bullish than three months before when nine analysts gave the stock a “Strong Buy.”
On Nov. 5, RBC Capital analyst Mark Dwelle raised AIG's price target to $87 from $80, maintaining an "Outperform" rating. He expects resilient P&C pricing trends and attractive combined ratios for Q1 despite challenges in improving core underwriting margins.
The mean price target of $84.72 represents a premium of 10% to AIG's current levels. However, the Street-high price target of $90 suggests that the stock could rally as much as 16.9%.
On the date of publication, Kritika Sarmah did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
