AMERICAN INTERNATIONAL GROUP (AIG) Stock Fundamental Analysis
NYSE:AIG - New York Stock Exchange, Inc. - US0268747849 - Common Stock - Currency: USD
AIG gets a fundamental rating of 3 out of 10. The analysis compared the fundamentals against 143 industry peers in the Insurance industry. Both the profitability and financial health of AIG have multiple concerns. AIG has a valuation in line with the averages, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
AIG had positive earnings in the past year.
AIG had a positive operating cash flow in the past year.
The reported net income has been mixed in the past 5 years: AIG reported negative net income in multiple years.
AIG had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
AIG has a Return On Assets of -0.88%. This is amonst the worse of the industry: AIG underperforms 85.31% of its industry peers.
With a Return On Equity value of -3.35%, AIG is not doing good in the industry: 85.31% of the companies in the same industry are doing better.
AIG has a Return On Invested Capital of 1.57%. This is comparable to the rest of the industry: AIG outperforms 45.45% of its industry peers.
AIG had an Average Return On Invested Capital over the past 3 years of 1.43%. This is below the industry average of 4.47%.
The last Return On Invested Capital (1.57%) for AIG is above the 3 year average (1.43%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -0.88% | ||
| ROE | -3.35% | ||
| ROIC | 1.57% |
ROA(3y)0.58%
ROA(5y)0.49%
ROE(3y)9.84%
ROE(5y)7.24%
ROIC(3y)1.43%
ROIC(5y)1.21%
1.3 Margins
With a decent Operating Margin value of 13.44%, AIG is doing good in the industry, outperforming 60.84% of the companies in the same industry.
AIG's Operating Margin has been stable in the last couple of years.
The Profit Margin and Gross Margin are not available for AIG so they could not be analyzed.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 13.44% | ||
| PM (TTM) | N/A | ||
| 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
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), AIG is destroying value.
AIG has less shares outstanding than it did 1 year ago.
The number of shares outstanding for AIG has been reduced compared to 5 years ago.
The debt/assets ratio for AIG is higher compared to a year ago.
2.2 Solvency
AIG has a debt to FCF ratio of 2.73. This is a good value and a sign of high solvency as AIG would need 2.73 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 2.73, AIG is in line with its industry, outperforming 41.96% of the companies in the same industry.
AIG has a Debt/Equity ratio of 0.21. This is a healthy value indicating a solid balance between debt and equity.
AIG's Debt to Equity ratio of 0.21 is fine compared to the rest of the industry. AIG outperforms 70.63% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.21 | ||
| Debt/FCF | 2.73 | ||
| Altman-Z | N/A |
ROIC/WACC0.2
WACC7.66%
2.3 Liquidity
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | N/A | ||
| Quick Ratio | N/A |
3. Growth
3.1 Past
The earnings per share for AIG have decreased strongly by -19.47% in the last year.
Measured over the past 5 years, AIG shows a small growth in Earnings Per Share. The EPS has been growing by 3.49% on average per year.
AIG shows a very negative growth in Revenue. In the last year, the Revenue has decreased by -27.31%.
The Revenue for AIG have been decreasing by -11.79% on average. This is quite bad
EPS 1Y (TTM)-19.47%
EPS 3Y2.17%
EPS 5Y3.49%
EPS Q2Q%-27.37%
Revenue 1Y (TTM)-27.31%
Revenue growth 3Y-20.13%
Revenue growth 5Y-11.79%
Sales Q2Q%-26.96%
3.2 Future
Based on estimates for the next years, AIG will show a quite strong growth in Earnings Per Share. The EPS will grow by 11.00% on average per year.
AIG is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.77% yearly.
EPS Next Y14.9%
EPS Next 2Y20.15%
EPS Next 3Y17.98%
EPS Next 5Y11%
Revenue Next Year-0.35%
Revenue Next 2Y2.26%
Revenue Next 3Y2.79%
Revenue Next 5Y4.77%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 14.88 indicates a correct valuation of AIG.
AIG's Price/Earnings ratio is in line with the industry average.
Compared to an average S&P500 Price/Earnings ratio of 28.79, AIG is valued a bit cheaper.
The Price/Forward Earnings ratio is 12.95, which indicates a correct valuation of AIG.
Compared to the rest of the industry, the Price/Forward Earnings ratio of AIG is on the same level as its industry peers.
The average S&P500 Price/Forward Earnings ratio is at 21.38. AIG is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.88 | ||
| Fwd PE | 12.95 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, AIG is valued a bit cheaper than the industry average as 63.64% of the companies are valued more expensively.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of AIG is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 14.49 | ||
| EV/EBITDA | 7.73 |
4.3 Compensation for Growth
The 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 17.98% in the coming years.
PEG (NY)1
PEG (5Y)4.27
EPS Next 2Y20.15%
EPS Next 3Y17.98%
5. Dividend
5.1 Amount
AIG has a Yearly Dividend Yield of 1.94%.
Compared to an average industry Dividend Yield of 3.22, AIG has a dividend in line with its industry peers.
AIG's Dividend Yield is slightly below the S&P500 average, which is at 2.47.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.94% |
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
AIG has negative earnings and hence a negative payout ratio. The dividend may be in danger.
The dividend of AIG is growing, but earnings are growing more, so the dividend growth is sustainable.
DP-71.81%
EPS Next 2Y20.15%
EPS Next 3Y17.98%
81.22
-1.23 (-1.49%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners95.43%
Inst Owner Change0.18%
Ins Owners0.21%
Ins Owner Change9.29%
Market Cap47.41B
Analysts75.83
Price Target89.98 (10.79%)
Short Float %1.97%
Short Ratio2.03
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.94% |
Yearly Dividend1.58
Dividend Growth(5Y)3.87%
DP-71.81%
Div Incr Years1
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)7.6%
Min EPS beat(2)4.69%
Max EPS beat(2)10.5%
EPS beat(4)3
Avg EPS beat(4)2.49%
Min EPS beat(4)-11.57%
Max EPS beat(4)10.5%
EPS beat(8)7
Avg EPS beat(8)5.95%
EPS beat(12)11
Avg EPS beat(12)7.58%
EPS beat(16)15
Avg EPS beat(16)10.26%
Revenue beat(2)1
Avg Revenue beat(2)3.79%
Min Revenue beat(2)-0.04%
Max Revenue beat(2)7.63%
Revenue beat(4)3
Avg Revenue beat(4)3.98%
Min Revenue beat(4)-0.04%
Max Revenue beat(4)7.63%
Revenue beat(8)5
Avg Revenue beat(8)0.2%
Revenue beat(12)8
Avg Revenue beat(12)6.17%
Revenue beat(16)11
Avg Revenue beat(16)7.98%
PT rev (1m)2.83%
PT rev (3m)1.64%
EPS NQ rev (1m)-1.7%
EPS NQ rev (3m)-36.14%
EPS NY rev (1m)0.25%
EPS NY rev (3m)-7.2%
Revenue NQ rev (1m)0.27%
Revenue NQ rev (3m)-2.08%
Revenue NY rev (1m)-2.12%
Revenue NY rev (3m)-3.36%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.88 | ||
| Fwd PE | 12.95 | ||
| P/S | 1.78 | ||
| P/FCF | 14.49 | ||
| P/OCF | 14.49 | ||
| P/B | 1.12 | ||
| P/tB | 1.21 | ||
| EV/EBITDA | 7.73 |
EPS(TTM)5.46
EY6.72%
EPS(NY)6.27
Fwd EY7.72%
FCF(TTM)5.61
FCFY6.9%
OCF(TTM)5.61
OCFY6.9%
SpS45.68
BVpS72.84
TBVpS67.06
PEG (NY)1
PEG (5Y)4.27
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -0.88% | ||
| ROE | -3.35% | ||
| ROCE | 2.25% | ||
| ROIC | 1.57% | ||
| ROICexc | 1.58% | ||
| ROICexgc | 2.28% | ||
| OM | 13.44% | ||
| PM (TTM) | N/A | ||
| GM | N/A | ||
| FCFM | 12.27% |
ROA(3y)0.58%
ROA(5y)0.49%
ROE(3y)9.84%
ROE(5y)7.24%
ROIC(3y)1.43%
ROIC(5y)1.21%
ROICexc(3y)1.44%
ROICexc(5y)1.22%
ROICexgc(3y)2.11%
ROICexgc(5y)1.79%
ROCE(3y)2.06%
ROCE(5y)1.74%
ROICexcg growth 3Y3.35%
ROICexcg growth 5Y12.63%
ROICexc growth 3Y4.86%
ROICexc growth 5Y12.01%
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
F-Score5
Asset Turnover0.17
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.21 | ||
| Debt/FCF | 2.73 | ||
| Debt/EBITDA | 1.22 | ||
| Cap/Depr | N/A | ||
| Cap/Sales | N/A | ||
| Interest Coverage | 4.18 | ||
| Cash Conversion | 45.59% | ||
| Profit Quality | N/A | ||
| Current Ratio | N/A | ||
| Quick Ratio | N/A | ||
| Altman-Z | N/A |
F-Score5
WACC7.66%
ROIC/WACC0.2
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-19.47%
EPS 3Y2.17%
EPS 5Y3.49%
EPS Q2Q%-27.37%
EPS Next Y14.9%
EPS Next 2Y20.15%
EPS Next 3Y17.98%
EPS Next 5Y11%
Revenue 1Y (TTM)-27.31%
Revenue growth 3Y-20.13%
Revenue growth 5Y-11.79%
Sales Q2Q%-26.96%
Revenue Next Year-0.35%
Revenue Next 2Y2.26%
Revenue Next 3Y2.79%
Revenue Next 5Y4.77%
EBIT growth 1Y-1.16%
EBIT growth 3Y-32.58%
EBIT growth 5Y-11.79%
EBIT Next Year134.64%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-47.57%
FCF growth 3Y-19.28%
FCF growth 5YN/A
OCF growth 1Y-47.57%
OCF growth 3Y-19.28%
OCF growth 5YN/A