On Monday, Jefferies adjusted its outlook on shares of American International Group (NYSE:AIG), reducing the price target to $90 from the previous $92, while keeping a Buy rating on the stock. This change follows significant developments within the company, including the deconsolidation of Corebridge Financial (CRBG) after a 5% secondary offering was completed last month.
American International Group also recently reached an agreement to divest its global personal travel insurance business, with the transaction expected to be finalized by the end of 2024. These strategic moves prompted Jefferies to update its financial model for AIG, taking into account second-quarter adjustments for catastrophic (CAT) losses and alternative investments (alts).
The revised model has led to a new earnings per share (EPS) forecast for AIG, with projections set at $5.40 for 2024, $7.10 for 2025, and $8.60 for 2026. Despite the lowered price target, Jefferies anticipates a 20% upside to the new target, signaling continued confidence in the insurer's stock performance.
The adjustments reflect the firm's response to recent corporate actions and market conditions impacting AIG. Investors and stakeholders in the insurance company will be watching closely to see how these changes influence its financial outcomes in the coming quarters.
In other recent news, American International Group (AIG) has seen several key developments. Evercore ISI cut AIG's stock target from $81 to $78, maintaining an in-line rating, following a comprehensive review that led to changes in the firm's financial forecasts for AIG. This adjustment was influenced by factors such as the deconsolidation of certain operations, an increased projected tax rate, and variations in net investment income.
AIG also plans to sell down its stake in Corebridge Financial Inc., with the anticipated sale of 3% of Corebridge in the third quarter of 2024 and 7.5% in the fourth quarter at a valuation of approximately $18.5 billion. This is expected to precede a 20% sale to Nippon in the first quarter of 2025.
In another development, Zurich Insurance acquired AIG's global personal travel insurance and assistance business for $600 million, a move expected to broaden Zurich's reach in the travel insurance market.
BofA Securities raised the price target for AIG shares to $84.00, maintaining a Neutral rating, following a shift in its valuation approach. This adjustment is in light of AIG's aggressive share repurchase strategy and the completion of the deconsolidation of Corebridge Financial.
Finally, AIG completed the deconsolidation of Corebridge Financial, marking a significant milestone for the company. This move aligns with AIG's strategic decisions to monetize its life insurance stake in Corebridge and implement cost efficiency programs. These are the recent developments for AIG.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.