With shares of American International Group (NYSE:AIG) trading at around $35.09, is AIG an OUTPERFORM, WAIT AND SEE or STAY AWAY? Let’s analyze the stock with the relevant sections of our CHEAT SHEET investing framework:
C = Catalyst for the Stock’s Movement
AIG almost took the entire economy down with it during the financial crisis. Whether you agree with the bailouts or not, they gave AIG new life. AIG is still nowhere near its all-time highs, but it’s nowhere near its all-time lows, either. However, there is still a lot of room for the stock to run or fall. Based on recent momentum, the situation is looking like a positive one. The stock is up almost 40 percent over the past year. When you look at the company’s fundamentals, you might be surprised with what you find. Margins are strong, the balance sheet is improving, and cash flow is decent. Analysts also now heavily favor the Buy side. AIG has made a concerted effort to get healthy over the past couple of years, and that effort is now paying off. If you’re concerned that the stock has climbed too high, keep in mind that the Trailing P/E is just 2.42. The Forward P/E is 9.94.
Let’s take a look at some more important numbers for AIG.