Wall Street analysts have given a one-year price target of $70.00 on American International Group (AIG), which reflects an ~14.1% increase from the current price. American International Group has a one-year forward price-to-earnings ratio of ~12.0x, and its peers’ average one-year forward price-to-earnings ratio stood at ~13.0x.
Other insurance companies (IYF) have the following one-year forward price-to-earnings ratios:
In 2Q17, AIG witnessed an increase of 33% in its Consumer Insurance division’s pretax operating income on a YoY basis. The company’s valuations could increase, as the company’s management expects to deploy capital in order to generate organic and inorganic profitable growth.
AIG’s management is focusing on improving the bottom-line numbers for its Commercial business. The company has a positive outlook on its Personal Insurance business in terms of future growth. Strong performance in the equity markets has benefited the Group Retirement and Individual Businesses in 2Q17.