Chris Lau, Kapitall: The turnaround at American International Group (AIG) is taking shape. Not only did the firm report a strong quarter, but AIG is buying back shares and working to sell its International Lease Finance Corp division (ILIC). Both moves suggest there is more upside to the stock. [Read more from Kapitall: Growth In Beauty: 3 Rallying Stocks With High ROE]Good: Quarterly results AIG earned $1.12 per share, beating estimates by a full $0.26. The board declared a dividend of $0.10 per share, which will yield only around 1% annually. AIG’s board also said it would buy back $1 billion of its shares, which should give AIG better support at current prices. Income rose nicely, particularly in Life & Retirement (up 23% from last year) and mortgage insurance (up 70%). The book value of AIG is $61.25, which is an increase of 11%. Catalyst: ILFC A sale of the ILFC would be positive for shareholders as it removes a non-core business and improves the overall health of AIG’s balance sheet. Once the company’s ILFC is sold, AIG could focus on its core business of insurance. AIG is working with a Chinese consortium to sell its leasing unit. A July 31 deadline passed, but AIG is extending the deadline to August 31. If the sale of the unit fails, it would not be a catastrophe for investors. AIG could issue an IPO to realize the full value of the leasing unit. AIG moving towards $50 AIG is set to trade around $50, a price not seen since 2011: Other reasons to be bullish The prospects of higher interest rates will be positive for AIG, since it would help the insurance company’s bottom line. AIG trades far below its book value of $61.25, a sharp discount to its historical average.