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American International Group (AIG)
NYSE:AIG
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American International Group
(NYSE:AIG)
66Neutral
Positive Factors
M&A and shareholder returns
Low leverage and excess capital provide flexibility for potential M&A deals and shareholder returns.
Reinsurance
Reinsurance arrangements offer downside protection for potential peril losses.
Tech and growth
Management focused on how technology will enable the next leg of growth and earnings.
Negative Factors
Earnings and stock repurchase
AIG's EPS estimates are lowered primarily due to fewer share repurchases.
Pricing power
Pricing-power within the large employer marketplace where AIG primarily operates continues to be 'soft,' possibly resulting in margin pressure.
Return on equity
The forecast for AIG's return on equity (RoE) has been revised downward to approximately 11.6% from a previous estimate of 13%.
American International Group (AIG) vs. S&P 500 (SPY)
Market Cap
$48.84B
Dividend Yield1.94%
Average Volume (3M)5.13M
Price to Earnings (P/E)18.7
Beta (1Y)0.55
Revenue Growth-44.30%
EPS Growth-33.09%
CountryUS
Employees22,200
SectorFinancial
Sector Strength83
IndustryInsurance - Diversified
Share Statistics
EPS (TTM)1.17
Shares Outstanding583,773,130
10 Day Avg. Volume3,845,178
30 Day Avg. Volume5,133,722
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.00
Price to Cash Flow (P/CF)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap1.25
Enterprise Value/RevenueN/A
Enterprise Value/Gross Profit2.23
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$89.29Price Target Upside8.19% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering17
American International Group Business Overview & Revenue Model
Company DescriptionAmerican International Group, Inc. (AIG) is a global insurance organization providing a wide range of property casualty insurance, life insurance, retirement solutions, and other financial services to customers in more than 80 countries and jurisdictions. Founded in 1919 and headquartered in New York City, AIG serves individuals and businesses with products and services designed to manage risk and provide for a secure future.
How the Company Makes MoneyAIG makes money primarily through underwriting insurance policies and investing the premiums collected from policyholders. The company offers a diverse portfolio of insurance products, including commercial and personal insurance, life insurance, and retirement products. Key revenue streams include premiums from its general insurance segment, which covers property, casualty, and specialty insurance, as well as income from its life and retirement segment, offering products like annuities, life insurance, and pension risk transfer. Additionally, AIG generates investment income by investing reserves from collected premiums in bonds, equities, and other financial instruments. Strategic partnerships and reinsurance agreements also play a role in managing risk and enhancing revenue potential.
American International Group Financial Statement Overview
Summary
AIG's financial performance is challenged by declining revenue, net losses, and increased leverage, despite maintaining positive cash flow. Strategic adjustments are necessary to improve profitability and reduce financial risk.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 | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 27.27B | 47.25B | 54.77B | 51.96B | 43.84B | Gross Profit |
| 27.27B | 47.25B | 54.77B | 51.96B | 43.84B | EBIT |
| 3.87B | 3.86B | 14.30B | 13.35B | -7.29B | EBITDA |
| 7.47B | 8.07B | 18.71B | 17.89B | -3.17B | Net Income Common Stockholders |
| -1.40B | 3.64B | 10.23B | 10.37B | -5.94B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 15.76B | 2.15B | 240.57B | 292.76B | 292.53B | Total Assets |
| 161.32B | 539.31B | 526.63B | 596.11B | 586.48B | Total Debt |
| 8.92B | 22.39B | 27.18B | 30.16B | 37.53B | Net Debt |
| 7.62B | 20.23B | 25.14B | 27.96B | 34.71B | Total Liabilities |
| 118.77B | 488.00B | 484.40B | 30.16B | 37.53B | Stockholders Equity |
| 42.52B | 45.35B | 40.00B | 65.96B | 66.36B |
| Cash Flow | Free Cash Flow | |||
| 3.27B | 6.24B | 4.21B | 5.53B | 2.85B | Operating Cash Flow |
| 3.27B | 6.24B | 4.21B | 6.28B | 1.04B | Investing Cash Flow |
| 1.67B | -7.02B | -3.63B | -3.28B | -6.20B | Financing Cash Flow |
| -5.06B | 782.00M | -676.00M | -3.73B | 5.06B |
American International Group Technical Analysis
Neutral
82.53
Price Trends
82.14
Negative
77.82
Positive
75.96
Positive
Market Momentum
0.15
Negative
49.30
Neutral
70.35
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AIG, the sentiment is Neutral. The current price of 82.53 is above the 20-day moving average (MA) of 81.76, above the 50-day MA of 82.14, and above the 200-day MA of 75.96, indicating a neutral trend. The MACD of 0.15 indicates Negative momentum. The RSI at 49.30 is Neutral, neither overbought nor oversold. The STOCH value of 70.35 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral 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 |
|---|---|---|---|---|---|---|---|
83 Outperform | $35.96B | 12.53 | 18.49% | 1.56% | 7.55% | 14.16% | |
74 Outperform | $34.94B | 9.54 | 18.42% | ― | 25.29% | -23.19% | |
73 Outperform | $17.11B | 16.41 | 9.70% | 3.81% | 5.84% | -10.64% | |
71 Outperform | $15.24B | 13.68 | 56.67% | 1.91% | 12.41% | 14.76% | |
66 Neutral | $48.84B | 18.69 | 6.13% | 1.94% | -44.30% | -33.09% | |
64 Neutral | $12.51B | 9.81 | 7.92% | 16985.69% | 12.67% | -5.98% | |
63 Neutral | $10.37B | 14.65 | 9.36% | 4.47% | -5.03% | ― |
* Financial Sector Average
Performance Comparison
AIG
American International Group
81.69
3.48
4.45%
AEG
Aegon
6.70
0.55
8.94%
ACGL
Arch Capital Group
92.69
-1.38
-1.47%
HIG
Hartford Financial
127.78
29.80
30.41%
PFG
Principal Financial
77.55
-2.57
-3.21%
EQH
Equitable Holdings
50.91
12.33
31.96%
American International Group Earnings Call Summary
Earnings Call Date:May 01, 2025
(Q1-2025)
| % Change Since: 2.09%|
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 Corporate Events
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.
Executive/Board ChangesBusiness Operations and Strategy
AIG Appoints Juan Perez to Board of Directors
Positive
Feb 20, 2025
On February 19, 2025, American International Group, Inc. (AIG) appointed Juan Perez, a prominent technology executive with extensive experience in artificial intelligence and digital transformation, to its Board of Directors. This strategic move aims to enhance AIG’s data and digital strategy, aligning with its focus on delivering exceptional value to clients and stakeholders and positioning the company for long-term success.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
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.