markets · · seekingalpha.com
American International Group: An 11.5% ROE Could Justify A Higher Multiple
I rate American International Group a Buy, with a fair value of $93, reflecting 12% upside and a 2.4% dividend yield. AIG's core operating ROE is running at 11.5%, above the 10.7% implied by the current price-to-book multiple of 1.12x. Expense reductions and premium growth support margin improvement, but softening property pricing and reserve risks could pressure future ROE.
I rate American International Group a Buy, with a fair value of $93, reflecting 12% upside and a 2.4% dividend yield. AIG's core operating ROE is running at 11.5%, above the 10.7% implied by the current price-to-book multiple of 1.12x. Expense reductions and premium growth support margin improvement, but softening property pricing and reserve risks could pressure future ROE.
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