AIG gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 148 industry peers in the Insurance industry. While AIG is still in line with the averages on profitability rating, there are concerns on its financial health. AIG is not valued too expensively and it also shows a decent growth rate.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

AIG had positive earnings in the past year.
In the past year AIG had a positive cash flow from operations.
In multiple years AIG reported negative net income over the last 5 years.
In the past 5 years AIG always reported a positive cash flow from operatings.

1.2 Ratios

AIG's Return On Assets of 1.99% is in line compared to the rest of the industry. AIG outperforms 50.68% of its industry peers.
With a Return On Equity value of 7.93%, AIG is not doing good in the industry: 67.57% of the companies in the same industry are doing better.
Looking at the Return On Invested Capital, with a value of 1.98%, AIG is in line with its industry, outperforming 47.30% of the companies in the same industry.
AIG had an Average Return On Invested Capital over the past 3 years of 1.44%. This is significantly below the industry average of 14.94%.
The last Return On Invested Capital (1.98%) for AIG is above the 3 year average (1.44%), which is a sign of increasing profitability.

		Industry Rank	Sector Rank
ROA	1.99%
ROE	7.93%
ROIC	1.98%

ROA(3y)0.58%

ROA(5y)0.49%

ROE(3y)9.84%

ROE(5y)7.24%

ROIC(3y)1.44%

ROIC(5y)1.21%

1.3 Margins

AIG's Profit Margin of 11.89% is fine compared to the rest of the industry. AIG outperforms 65.54% of its industry peers.
AIG has a better Operating Margin (16.78%) than 65.54% of its industry peers.
AIG's Operating Margin has been stable in the last couple of years.

		Industry Rank	Sector Rank
OM	16.78%
PM (TTM)	11.89%
GM	N/A

OM growth 3Y-15.59%

OM growth 5Y-0.01%

PM growth 3YN/A

PM growth 5YN/A

GM growth 3YN/A

GM growth 5YN/A

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so AIG is destroying value.
Compared to 1 year ago, AIG has less shares outstanding
Compared to 5 years ago, AIG has less shares outstanding
AIG has a worse debt/assets ratio than last year.

2.2 Solvency

AIG has a debt to FCF ratio of 3.20. This is a good value and a sign of high solvency as AIG would need 3.20 years to pay back of all of its debts.
AIG has a Debt to FCF ratio (3.20) which is in line with its industry peers.
A Debt/Equity ratio of 0.22 indicates that AIG is not too dependend on debt financing.
AIG's Debt to Equity ratio of 0.22 is fine compared to the rest of the industry. AIG outperforms 66.22% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	0.22
Debt/FCF	3.2
Altman-Z	N/A

ROIC/WACC0.27

WACC7.45%

2.3 Liquidity

		Industry Rank	Sector Rank
Current Ratio	N/A
Quick Ratio	N/A

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

AIG shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 8.91%, which is quite good.
The Earnings Per Share has been growing slightly by 3.49% on average over the past years.
Looking at the last year, AIG shows a small growth in Revenue. The Revenue has grown by 3.02% in the last year.
AIG shows a very negative growth in Revenue. Measured over the last years, the Revenue has been decreasing by -11.79% yearly.

EPS 1Y (TTM)8.91%

EPS 3Y2.17%

EPS 5Y3.49%

EPS Q2Q%78.86%

Revenue 1Y (TTM)3.02%

Revenue growth 3Y-20.13%

Revenue growth 5Y-11.79%

Sales Q2Q%-5.93%

3.2 Future

AIG is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 10.98% yearly.
Based on estimates for the next years, AIG will show a small growth in Revenue. The Revenue will grow by 4.77% on average per year.

EPS Next Y30.24%

EPS Next 2Y20.53%

EPS Next 3Y17.48%

EPS Next 5Y10.98%

Revenue Next Year3.21%

Revenue Next 2Y4.91%

Revenue Next 3Y5.55%

Revenue Next 5Y4.77%

3.3 Evolution

The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.

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4. Valuation

4.1 Price/Earnings Ratio

A Price/Earnings ratio of 11.39 indicates a reasonable valuation of AIG.
AIG's Price/Earnings ratio is in line with the industry average.
AIG is valuated cheaply when we compare the Price/Earnings ratio to 27.25, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 9.30, which indicates a very decent valuation of AIG.
Based on the Price/Forward Earnings ratio, AIG is valued a bit cheaper than the industry average as 61.49% of the companies are valued more expensively.
AIG's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 25.98.

		Industry Rank	Sector Rank
PE	11.39
Fwd PE	9.3

4.2 Price Multiples

72.97% of the companies in the same industry are more expensive than AIG, based on the Enterprise Value to EBITDA ratio.
The rest of the industry has a similar Price/Free Cash Flow ratio as AIG.

		Industry Rank	Sector Rank
P/FCF	13.79
EV/EBITDA	5.72

4.3 Compensation for Growth

AIG's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as AIG's earnings are expected to grow with 17.48% in the coming years.

PEG (NY)0.38

PEG (5Y)3.27

EPS Next 2Y20.53%

EPS Next 3Y17.48%

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5. Dividend

5.1 Amount

With a Yearly Dividend Yield of 2.49%, AIG has a reasonable but not impressive dividend return.
AIG's Dividend Yield is a higher than the industry average which is at 2.41.
AIG's Dividend Yield is a higher than the S&P500 average which is at 1.82.

		Industry Rank	Sector Rank
Dividend Yield	2.49%

5.2 History

The dividend of AIG has a limited annual growth rate of 3.87%.
AIG has paid a dividend for at least 10 years, which is a reliable track record.
The dividend of AIG decreased recently.

Dividend Growth(5Y)3.87%

Div Incr Years1

Div Non Decr Years1

5.3 Sustainability

30.01% of the earnings are spent on dividend by AIG. This is a low number and sustainable payout ratio.
AIG's earnings are growing more than its dividend. This makes the dividend growth sustainable.

DP30.01%

EPS Next 2Y20.53%

EPS Next 3Y17.48%

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AMERICAN INTERNATIONAL GROUP / AIG FAQ

What is the fundamental rating for AIG stock?

ChartMill assigns a fundamental rating of 4 / 10 to AIG.

Can you provide the valuation status for AMERICAN INTERNATIONAL GROUP?

ChartMill assigns a valuation rating of 6 / 10 to AMERICAN INTERNATIONAL GROUP (AIG). This can be considered as Fairly Valued.

How profitable is AMERICAN INTERNATIONAL GROUP (AIG) stock?

AMERICAN INTERNATIONAL GROUP (AIG) has a profitability rating of 4 / 10.

What is the valuation of AMERICAN INTERNATIONAL GROUP based on its PE and PB ratios?

The Price/Earnings (PE) ratio for AMERICAN INTERNATIONAL GROUP (AIG) is 11.39 and the Price/Book (PB) ratio is 0.97.

Can you provide the expected EPS growth for AIG stock?

The Earnings per Share (EPS) of AMERICAN INTERNATIONAL GROUP (AIG) is expected to grow by 30.24% in the next year.