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American International Group Inc. (AIG) Stock

American International Group Inc. Stock Details, Movements and Public Alerts

American International Group Inc. (AIG): The $50B Insurance Giant Reborn from the 2008 Ashes

Few companies have fallen as far and climbed back as dramatically as American International Group. In 2008, AIG's collapse required the largest corporate bailout in U.S. history—$182 billion from taxpayers—after derivatives bets on mortgage securities nearly destroyed the global financial system. Fast forward to 2025, and AIG is unrecognizable: CEO Peter Zaffino, who took the reins in 2021, has completed a radical simplification—shedding $50+ billion in non-core assets, exiting commercial mortgages and problematic products, and refocusing on core general insurance and life & retirement businesses. The company now generates $50 billion in revenue across property & casualty (covering airlines, energy companies, and commercial real estate) and life insurance/annuities. With a fortress balance sheet (AA- credit rating), 10%+ return on equity, and $5 billion in annual free cash flow funding dividends and buybacks, AIG has transformed from a cautionary tale into a value play. Trading at 10x forward earnings with a 2.1% yield, AIG offers investors exposure to commercial insurance markets with the discount of its troubled past baked into the valuation.

52-Week Range

$87.10 - $68.14

-10.44% from high · +14.48% from low

Avg Daily Volume

19,247

Latest volume

Fundamentals

Valuation Metrics

P/E Ratio (TTM)

14.59

Below market average

Forward P/E

10.06

Earnings expected to grow

PEG Ratio

0.85

Potentially undervalued

Price to Book

1.04

EPS (TTM)

$5.34

Price to Sales

1.58

Beta

0.72

Less volatile than market

How is AIG valued relative to its earnings and growth?
American International Group Inc. trades at a P/E ratio of 14.59, which is below the market average of approximately 20. This lower valuation could indicate the market has modest growth expectations, or it might represent an undervalued opportunity if the fundamentals are strong. Looking ahead, the forward P/E of 10.06 is lower than the current P/E, indicating analysts expect earnings to grow over the next year. The PEG ratio of 0.85 suggests the stock may be undervalued relative to its growth rate.
What is AIG's risk profile compared to the market?
With a beta of 0.72, American International Group Inc. is less volatile than the overall market. This means when the market moves up or down by 10%, this stock typically moves less than 10% in the same direction. Lower beta stocks are often preferred by conservative investors seeking stability. The price-to-book ratio of 1.04 shows investors value the company above its book value, which often reflects intangible assets or growth prospects.

Performance & Growth

Profit Margin

11.70%

Operating Margin

23.80%

EBITDA

$8.20B

Return on Equity

7.60%

Return on Assets

1.73%

Revenue Growth (YoY)

8.30%

Earnings Growth (YoY)

-33.30%

How profitable and efficient is AIG's business model?
American International Group Inc. achieves a profit margin of 11.70%, meaning it retains $11.70 from every $100 in revenue after all expenses. This represents a solid margin typical of well-run businesses, showing the company can effectively balance revenue generation with cost control. The operating margin of 23.80% reveals how efficiently the company runs its core business operations before interest and taxes. With ROE at 7.60% and ROA at 1.73%, the company achieves moderate returns on invested capital.
What are AIG's recent growth trends?
American International Group Inc.'s revenue grew by 8.30% year-over-year, showing steady progress in growing the business. This positive trajectory indicates the company maintains competitive positioning in its markets. Earnings decreased by 33.30% year-over-year, reflecting the bottom-line impact of business performance. These growth metrics should be evaluated against INSURANCE - DIVERSIFIED industry averages for proper context.

Dividend Information

Dividend Per Share

$1.65

Dividend Yield

2.12%

Ex-Dividend Date

Sep 16, 2025

Dividend Date

Sep 30, 2025

What dividend income can investors expect from AIG?
American International Group Inc. offers a dividend yield of 2.12%, paying $1.65 per share annually. This above-average yield of 2-4% provides meaningful income while still allowing the company to reinvest for growth. It compares favorably to the S&P 500 average and offers competitive returns versus bonds in the current rate environment. To receive the next dividend, shares must be purchased before the ex-dividend date of Sep 16, 2025.
How reliable is AIG's dividend for long-term investors?
The dividend sustainability can be assessed through the payout ratio - American International Group Inc. pays $1.65 per share in dividends against earnings of $5.34 per share, resulting in a payout ratio of 30.90%. This balanced payout between 30-60% suggests a sustainable dividend policy that allows both shareholder returns and business reinvestment. The dividend appears well-covered by earnings. The next dividend payment is scheduled for Sep 30, 2025.

Company Size & Market

Market Cap

$43.2B

Revenue (TTM)

$27.40B

Revenue/Share (TTM)

$45.12

Shares Outstanding

554.00M

Book Value/Share

$74.14

Asset Type

Common Stock

What is AIG's market capitalization and position?
American International Group Inc. has a market capitalization of $43.2B, classifying it as a large-cap stock ($10B-$200B). Large-caps are typically industry leaders with established business models, offering a balance of stability and growth potential. They often provide dividend income and are core holdings in institutional portfolios. With 554.00M shares outstanding, the company's ownership is relatively concentrated. As a participant in the INSURANCE - DIVERSIFIED industry, it competes with other firms in this sector.
How does AIG's price compare to its book value?
American International Group Inc.'s book value per share is $74.14, while the current stock price is $78.01, resulting in a price-to-book (P/B) ratio of 1.05. This reasonable premium to book value suggests the market values the company's earnings power and intangible assets appropriately. Most profitable companies trade between 1-3x book value. As a common stock, this represents equity ownership with voting rights.

Analyst Ratings

Analyst Target Price

$88.28

13.16% upside potential

Analyst Recommendations

Strong Buy

3

Buy

5

Hold

11

Sell

0

Strong Sell

0

How reliable are analyst predictions for AIG?
19 analysts cover AIG with 42% recommending buy/strong buy ratings. Analyst predictions have mixed reliability - studies show consensus rarely beats market returns consistently. The mixed views reflect uncertainty about the outlook. The consensus target of $88.28 implies 13.2% upside, but targets are often adjusted to follow price moves rather than predict them.
What is the Wall Street consensus on AIG?
Current analyst recommendations:3 Strong Buy, 5 Buy, 11 Hold, 00The neutral stance suggests uncertainty or fair valuation at current levels.Remember that analyst opinions often lag price movements and can be influenced by investment banking relationships.

Fundamentals last updated: Oct 1, 2025, 07:33 AM

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American International Group Inc. (AIG) Stock Analysis 2025: Complete Investment Guide

Peter Zaffino's Radical Simplification

When Peter Zaffino became CEO of AIG in March 2021, he inherited a company still haunted by 2008. Despite returning taxpayer funds with profit by 2012, AIG remained bloated—sprawling insurance operations across 80+ countries, legacy liabilities from decades of acquisitions, and a reputation that made "too big to fail" synonymous with the company name. Zaffino, a 40-year insurance veteran who joined AIG in 2017 as president, had a clear mandate: simplify, focus, and restore profitability.

By 2025, Zaffino's transformation is largely complete. AIG sold or exited over $50 billion in non-core businesses—commercial mortgages, international life operations (Fortitude Re deal), retail mutual fund business (SunAmerica), and subscale country operations. The company now operates two core segments: General Insurance (commercial property & casualty) and Life & Retirement (life insurance, annuities, retirement services). Underwriting discipline has improved dramatically—the combined ratio (claims + expenses / premiums) dropped from 103% in 2019 to ~95% by 2024, indicating profitable underwriting. The result: AIG generates 10%+ ROE, produces $5 billion in annual free cash flow, and trades at a valuation discount reflecting its past, not its present reality.

Business Model & Competitive Moat

AIG operates two primary divisions: General Insurance (60% of premiums) provides commercial property & casualty coverage to corporations globally—aviation insurance for airlines, energy insurance for oil/gas companies, D&O coverage for executives, cyber insurance, and specialty lines; Life & Retirement (40%) offers life insurance, fixed and variable annuities, and retirement services to individuals and institutions. Revenue comes from insurance premiums, investment income on float ($300B+ portfolio), and fees on retirement products.

AIG's competitive advantages center on scale and expertise: Commercial market leadership—top 3 globally in commercial insurance with deep client relationships; specialty lines expertise—decades of underwriting experience in complex risks (aviation, energy, marine) that require technical knowledge; global distribution—operates in 80+ countries with local market access; investment portfolio—$300B+ in assets generating 3-4% yields supplementing underwriting profits; brand recognition—despite 2008, AIG remains a trusted name for complex commercial risks; and regulatory barriers—insurance requires massive capital and regulatory approvals limiting new entrants. These advantages generate stable underwriting profits and predictable cash flows through economic cycles.

Financial Performance

AIG's financials reflect the transformation—improved profitability and capital generation:

  • •Total Revenue (2024): $50.3 billion; stable with 3-5% growth from premium increases and investment income
  • •Net Premiums: $35B+ across General Insurance ($21B) and Life & Retirement ($14B)
  • •Combined Ratio (Gen Insurance): ~95%; below 100% indicates profitable underwriting
  • •Return on Equity: 10-12%; solid for P&C insurers, reflects underwriting discipline
  • •Adjusted EPS: ~$7.00 for 2024-2025; consistent growth from operations and buybacks
  • •Free Cash Flow: $5B+ annually; supports $2B dividends + $3B buybacks
  • •Book Value per Share: $70+; trading at ~1.0x book value indicates fair valuation
  • •Credit Rating: AA- (S&P); strong financial strength

AIG targets 10%+ ROE sustainably, with capital return of $5B+ annually split between dividends (2.1% yield) and opportunistic buybacks. The company has reduced share count by 15%+ since 2019, creating per-share value as profitability improves.

Growth Catalysts

  • •Commercial Insurance Pricing: Hard market conditions driving 5-10% annual premium increases in specialty lines
  • •Cyber Insurance Growth: Exploding demand for cyber coverage; AIG is a market leader with pricing power
  • •Aviation Recovery: Commercial aviation insurance rebounding as air travel normalizes post-pandemic
  • •Life & Retirement Stability: Fixed annuities benefit from higher interest rates; recurring premiums provide cash flow
  • •Investment Yield Expansion: Rising rates boost portfolio yields; every 1% = $3B additional income
  • •Operational Efficiency: Simplification and technology reducing expense ratios by 2-3 points
  • •Capital Deployment: $5B+ annual cash flow for dividends, buybacks, and bolt-on acquisitions

Risks & Challenges

  • •Catastrophe Risk: Hurricanes, earthquakes, wildfires create lumpy underwriting results; climate change increasing frequency
  • •Reputation Overhang: 2008 bailout still colors investor perception despite transformation
  • •Competition: Chubb, Zurich, Munich Re, and Lloyd's syndicates competing for commercial business
  • •Regulatory Capital: Insurance regulations require holding significant capital, limiting leverage and returns
  • •Economic Sensitivity: Recession reduces commercial insurance demand and increases claims (D&O, trade credit)
  • •Investment Risk: $300B portfolio exposed to credit, equity, and real estate risks
  • •Execution Risk: Transformation incomplete in some areas; integration challenges remain

Competitive Landscape

AIG competes in global commercial insurance and U.S. life/retirement markets. In commercial P&C, competitors include Chubb (CB)—the premium brand with better underwriting margins, Zurich Insurance—Swiss global giant, Munich Re—reinsurance leader, and Travelers (TRV)—strong in U.S. commercial. In Life & Retirement, competitors include MetLife, Prudential, and Lincoln Financial.

CompanyMarket CapPrimary BusinessDividend YieldP/EROE
AIG$50BCommercial + Life/Retirement2.1%10x forward10-12%
Chubb (CB)$110BPremium commercial1.5%13x12-14%
Travelers (TRV)$55BU.S. commercial2.0%11x12-14%
MetLife (MET)$60BLife + annuities2.5%10x12-14%
Prudential (PRU)$40BLife + retirement4.5%9x10-12%

AIG trades at a discount to Chubb (10x vs. 13x P/E) despite similar businesses, reflecting reputation concerns and investor skepticism about the transformation's sustainability. For value investors, this creates opportunity—AIG's fundamentals have improved dramatically, but the market hasn't fully recognized it.

Who Is This Stock Suitable For?

Perfect For

  • ✓Value investors seeking turnaround stories at discounts (10x P/E, 1.0x book)
  • ✓Dividend growth investors comfortable with 2.1% yield + buybacks
  • ✓Insurance sector allocators wanting commercial P&C exposure
  • ✓Contrarians betting on reputation rehabilitation and multiple expansion
  • ✓Those seeking exposure to commercial insurance hard market

Less Suitable For

  • ✗Risk-averse investors uncomfortable with AIG's 2008 history
  • ✗High-growth seekers (insurance is mature, slow-growth industry)
  • ✗High-yield investors (2.1% is modest compared to other insurers)
  • ✗ESG-focused investors (fossil fuel exposure through energy insurance)
  • ✗Short-term traders (insurance stocks move slowly)

Investment Thesis

AIG is the ultimate value play on corporate transformation. Peter Zaffino has executed a radical simplification, shedding $50+ billion in assets, improving underwriting discipline, and restoring profitability. The company now generates 10%+ ROE, produces $5 billion in annual free cash flow, and operates with a fortress balance sheet. Yet AIG trades at 10x forward earnings—a 30% discount to peers like Chubb and Travelers—because investors can't forget 2008. This creates opportunity for those willing to separate past from present.

The investment case hinges on multiple expansion. If AIG can sustain 10%+ ROE and prove the transformation is permanent, the market should re-rate the stock toward peer valuations (12-13x P/E), implying 20-30% upside plus dividends. The commercial insurance hard market provides tailwinds (pricing power), higher interest rates boost investment income, and capital return (dividends + buybacks) compounds per-share value. Risks include catastrophe losses and reputation overhang—but at 10x earnings and 1.0x book value, much bad news is already priced in. For value investors seeking insurance exposure with asymmetric upside, AIG offers compelling risk-reward. Expect 12-15% annual returns over 3-5 years as the transformation story gains recognition.

Conclusion

Conclusion

AIG is a BUY for value investors comfortable with the company's history. The transformation is real, fundamentals are strong, and valuation provides margin of safety. Build positions below $75 for 2.5%+ yield equivalent (including buybacks). This is not a widow-and-orphan stock, but for those seeking discounted insurance exposure with turnaround optionality, AIG delivers. The ghost of 2008 creates the opportunity.
Bull Case
$95 (30% upside) - Multiple expands to 12-13x as transformation gains credibility
Base Case
$80 (10% upside) - Steady 10-12% ROE, 12-15% annual returns with buybacks
Bear Case
$60 (15% downside) - Major catastrophe losses, recession, reputation concerns resurface

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