Stockchase Opinions

Barry Schwartz American International Group AIG-N COMMENT Aug 05, 2014

Started buying this a few months ago. Reported very good earnings last night and are buying back stock. Announced keeping their same strategy of slow and measured growth, but came out today and said that pricing was a little bit weaker than expected, so the stock did not react to the positive earnings. Trading at a deep discount to Book Value. Thinks they are creating shareholder value by Buying back stock at a discount. A lot more upside here.

$52.200

Stock price when the opinion was issued

insurance
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DON'T BUY

Had owned this until about a year ago, and then moved aside. Had some difficulties with management. Even against their peer group in the insurance space, this company is not operating that efficiently.

PAST TOP PICK

(A Top Pick Jan 4/17, Down 6%) He thought the street might recognize its value. He got his money back but decided he could do better elsewhere.

PAST TOP PICK

(A Top Pick Jan 5/17. Down 5%.) Very disappointing. Still struggling and is at EBV-3. As interest rates go up, this should do better.

HOLD

Fine at current levels and would stick with it. It's building a base around $59-60. Looks solid here.

PAST TOP PICK

(A Top Pick Feb 6/17 Down 5%). He thinks insurance companies are having a tough go. They are not benefiting like other financial assets. He is disappointed with its performance.

DON'T BUY

The company is trading below book value. He does not see many companies who can combine P&C and Life business well. It has never really recovered from the financial crisis.

PAST TOP PICK

(Past Top Pick, June 13, 2017, Down 12%) He sold his earnings last November to cut his losses. The reason was that AIG took massive writedowns after their new CEO took over. He didn't want to be in this turnaround plan.

COMMENT

AIG-N vs. MET-N. AIG-N has been recapitalizing since the disaster of the financial crisis. MET-N did not suffer these issues. The life business is in pretty decent shape but he prefers Canadian lifecos.

HOLD
Stock is slowly turning around. Longer term, not a bad place to be. It has too many verticals. Doesn't see a major issue from coronavirus.
DON'T BUY
AIG is famous for imploding during the Great Recession and remains a major player. Outside Canada, he avoids insurers. In Canada he likes Sun-Life and Manulife, because there's less competition. Elsewhere, it's more competitive, but earnings are more volatile.