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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
American International Group, Inc. (XNYS:AIG) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
AIG
Name:
AMERICAN INTERNATIONAL GROUP, INC. (XNYS:AIG)
Sector:
-
Industry:
Insurance�Diversified
CEO:
Mr. Peter Zaffino
Total Employees:
36,600
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -42.34% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF AMERICAN INTERNATIONAL GROUP, INC.(AIG) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND INSURANCE�DIVERSIFIED INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
52.41
One Month Price Target:
$52.76
Six Month Price Target :
$54.49
Likely Price in One Year's Time:
Ticker:
$56.57
Likely Trading Range Today Under (Normal Volatility)
$52.16
Price Upper limit ($) :
$52.72
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$49.08
This week:
$44.95
This month :
$37.5
Other Primary facts
Market Cap:
39.82B
Market Cap Classification:
Large Cap
Number of Shares
IPO Date:
760.42M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
18.81%
-20.84%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$67.88
$60.78
$36.94
$44.04
Medium risk (<10%) entry points
Buy Call
Sell Call
$58.47
Buy Put:
Sell Put:
$56.96
$46.33
$47.86
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
AIG
Sharpe Ratio:
1.48%
Comparison:
AIG, is amongst the top 60% stocks with highest risk-adjusted returns
Sharpe ratio is -39.54% lower than the industry
& is -35.05% lower than the market/S&P 500 average
Average Returns/Yield of
AIG
Daily returns:
0.06%
Weekly returns:
0.28%
Monthly returns:
1.10%
Yearly returns:
19.61%
Comparison of returns:
Average annual returns/yield (last 3 years) is -32.55% below industry average
Classification:
AIG, is amongst the top 60% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.54
Statistical test of Returns:
AIG has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
3.12%
Weekly Volatility:
6.99%
Monthly Volatility:
13.97%
Yearly Volatility:
48.41%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.05%
Volatility in last five trading days has been -66.53% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-6.36%
Weekly VaR:
-14.23%
Monthly VaR:
-28.45%
How Much Can the price of
AIG
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-25%
Worst case (decline):
>85%
This translates to price declining to:
$39.55
This translates to price declining to:
$7.86
Severe Crash Probability
Risk of crash in next 6/12 months: Medium (<50%)
What is Value at Risk (VaR)?
Risk Fundamentals
AIG is a 100.81% riskier investment compared to the market/S&P 500 & is 72.04% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 1.88% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
AIG
Beta in relation to market/S&P 500--1.18
Expected beta in 1 year's time:
0.773
Expected beta in 3 year's time:
1.093
Unlevered (debt free) Beta:
0.882
Beta in relation to Nasdaq (XNAS):
0.919
Beta in relation to all global stocks::
1.069
Beta Comparison & Analysis
Beta of competitors/peers::
1.22
Beta is -3.13% lower than peers
Average Industry Beta:
1.088
Beta is 8.57% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
7.65%
Sustainable growth rate is -91.64% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.020
Alpha is -77.99% below industry average alpha yield
Alpha is 126% higher than market/& is unsustainably high
Analysis of Cost of Capital of
AIG
Equity cost of capital:
0.112
Equity cost of capital is 6.02% above industry mean WACC
Unlevered (without debt) cost of capital:
8.39%
Before-tax cost of debt:
5.20%
After-tax cost of debt:
4.11%
Overall debt rating:
Lower BB medium grade (Fifth highest grade)
Weighted average cost of capital (WACC):
4.11%
WACC is 18.35% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$69.91
Revenue growth rate per share of (3Y):
0.69
Annual revenue growth rate is -60.77% below industry average
EPS:
$11.59
Expected Annual growth rate of EPS (3Y):
41.86%
Expected future EPS growth rate is 681.25% higher than the Insurance�Diversified industry
Free cash flow (FCF) per share:
$6.50
Balance sheet equity growth per share: 0.99%
Equity growth rate per share is -97.54% lower than the industry
Debt per share
$31.00
EBITDA per share
$22.04
Valuation Analysis Today of
AIG
P/E Ratio:
3.43
P/E Ratio of Competitors/Peers:
18.51
P/E ratio is -81.46% lower than main peers & is -94.19% lower than the industry
Stock price/value with industry average P/E ratio: $684.97
AIG is -92.35% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $32.69
Present value of the expected future dividends only: $11.38
P/S (Price to Sales ratio):
0.75
Price to sales ratio is -73.64% below the industry mean
P/B (Price to book value ratio):
0.69
Price to free cash flow: 8.06
-
Net income growth rate (3Y):
-161803.66%
Net income growth rate is 500.42% higher than the average industry net income growth rate
Dividend Analysis
-
Dividend yeild: 2.44%
Previous Dividend: $0.32
Previous adjusted dividend: $0.32
Previous Dividend: $1.28
-
-
Average dividend payment (long-term): $0.32
Average dividend increase/decrease (growth rate) % per period: 0.00%
Expected next dividend payment date: 28/09/2022
Expected next dividend record date: 14/09/2022
-
Previous dividend payment date: 30/06/2022
Previous dividend record date: 16/06/2022
-
Dividend History:
2022-06-15--$0.32
2021-12-15--$0.32
2021-06-14--$0.32
2022-03-16--$0.32
2021-09-15--$0.32
2021-03-15--$0.32
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
42.13%
Net debt to equity ratio:
37.60%
Debt to assets ratio:
4.11%
Net debt to assets ratio:
3.67%
Debt-to-asset ratio is -95.67% below industry average
Ability to repay debt:
Interest coverage ratio:
13.67
Interest coverage ratio is 689.70% more than industry average
Looking forward:
Debt growth rate:
-19.64%
Annual debt growth is 1711% higher than industry average debt growth rate
Debt repayment rate in last quarter: 0.00%
Analysis of Key Statistics
Correlation of price movement with the market:
0.691
Statistical significance of correlation:
AIG has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.59
Stock price is 17.15% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.59
Correlation of price movement with Nasdaq (^IXIC):
0.055
Covariance of price movement with the market:
0.099
Kurtosis
8.507
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-0.441
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
AIG
Gross Profit Margin Ratio:
-
Operating Profit Margin Ratio:
8.76%
Operating profit margin is 54.65% higher than the industry
Net Profit Margin Ratio:
-
Effective Tax Rate:
19.36%
Effective tax rate is -9.97% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
17.45%
Return on equity (ROE) is -194.11% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
1.70%
Return on assets (ROA) is 6.38% higher than the industry
Financial Leverage:
1.0x
Current Ratio:
10.63
Current ratio is -54.70% below industry average
Cash Conversion Cycle (days):
0
-
The remaining useful life of property plant & equipment is: 3.9 years
Stock based compensation to net income ratio:
-
In-depth Efficiency Analysis
Revenue generated per employee:
1.5M
Each employee generates 39% more revenue than industry average revenue per employee
EBITDA generated per employee:
457.9K
Each employee generates 108% more EBITDA than industry average revenue per employee
Profit generated per employee:
266.8K
Each employee generates 90% more net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
0.0K
-
Assets/Capital per employee
367.1K
-
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
AIG
LLOYDS BANKING GROUP PLC (XNYS:LYG)
AEB
Sumitomo Mitsui Financial Group, Inc. (XNYS:SMFG)
PRUDENTIAL PUBLIC LIMITED COMPANY (XNYS:PUK)
SCHW-PD
BARCLAYS PLC (XNYS:BCS)
MSCI INC. (XNYS:MSCI)
CANADIAN IMPERIAL BANK OF COMMERCE (XNYS:CM)
ING Groep NV (XNYS:ING)
Current Analyst Ratings
Strong buy�13%
Buy�29%
Hold�29%
Sell�4%
Strong sell�4%
Overall analyst sentiment is: Buy
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
53.16B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
-
-
-
6.70B
6.70B
-
2.18B
2.18B
1.60B
1.23B
3.21B
16.76B
4.66B
9.77B
13.21B
2.56B
9.77B
Statement of Cash Flow
Date:
Period:
-
Differed Income Tax :
13.44B
Stock Based Compensation :
-
Change in Working Capital :
- 60905000.00K
Accounts Receivables:
-
Other Working Capital:
-
Other Non-Cash Items:
-
Net Cash Provided by Operating Activities:
-
Investments in PP&E:
-
Net Acquisitions:
-
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
2.54B
337.87B
340.41B
47.47B
-
-
387.88B
-
-
-
-
13.44B
-
13.44B
199.07B
573.51B
36.48B
-
-
-
-
36.48B
23.57B
455.36B
478.93B
-
515.41B
- 52791000.00K
27.76B
- 5900000.0K
86.87B
March 31, 2022 at 6:00:00 AM
29.99B
55.94B
571.35B
337.87B
23.57B
21.0B
-
-
-
-
-
-
-
-
-
-
-
-
2.43B
-
-
-
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
AIG
2023
2024
2025
2026
2027
$56.85
$135.54
$146.30
$157.91
$170.45