American International Group (AIG) Recovers on High Volume

NEW YORK (TheStreet) -- American International Group  (AIG) rose 2.43% to $50.17, up $1.19 from its previous close of $48.98, at the close of the trading day on Tuesday as the insurance company rebounded from its dip on Friday.

The stock hit a high of $50.43 and a low of $49 for the day, Tuesday. It holds a one-year high of $53.33 and a one-year low of $36.68. The stock had a volume of 13,529,710, above its average of 9,322,020.

AIG reported Thursday that it had turned a profit in the fourth quarter, announced a plan to raise its dividend and said it would buy back more of its own shares, but the stock still fell Friday.

Must ReadAIG Leads Financials as Investors Digest Q4 and Dividend

TheStreet Ratings team rates AMERICAN INTERNATIONAL GROUP as a "hold" with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:

"We rate AMERICAN INTERNATIONAL GROUP (AIG) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth and compelling growth in net income. However, as a counter to these strengths, we find that revenues have generally been declining."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • Powered by its strong earnings growth of 432.00% and other important driving factors, this stock has surged by 27.57% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
  • Despite the weak revenue results, AIG has outperformed against the industry average of 21.5%. Since the same quarter one year prior, revenues slightly dropped by 8.0%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • AMERICAN INTERNATIONAL GROUP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, AMERICAN INTERNATIONAL GROUP increased its bottom line by earning $6.07 versus $4.27 in the prior year. For the next year, the market is expecting a contraction of 27.8% in earnings ($4.38 versus $6.07).
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly underperformed compared to the Insurance industry average, but is greater than that of the S&P 500. The net income increased by 150.0% when compared to the same quarter one year prior, rising from -$3,958.00 million to $1,978.00 million.
  • You can view the full analysis from the report here: AIG Ratings Report
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