Michael Zaremski, an analyst from BMO Capital, maintained the Hold rating on American International Group (AIG – Research Report). The associated price target remains the same with $83.00.
Michael Zaremski has given his Hold rating due to a combination of factors influencing AIG’s financial outlook. One significant reason is the revised forecast for AIG’s return on equity, which is now expected to be around 11.6% by 2027, a decrease from the previous estimate of 13%. This adjustment is accompanied by a reduction in the expected earnings per share for 2026 and 2027, primarily due to a decrease in projected share repurchases.
Additionally, the decision to lower stock repurchase levels reflects a more conservative approach to capital management, considering AIG’s risk-based capital levels and the need to support new sales growth. AIG’s capital conservatism, particularly in its Japanese subsidiaries, also plays a role in this rating. Furthermore, the target price for AIG’s stock is set at a discount compared to its peer Chubb, reflecting a less favorable valuation multiple. These factors collectively contribute to the Hold rating, indicating a cautious stance on AIG’s future performance.