AIG Stock: Analysts Stay Cautiously Bullish Despite Underperformance
American International Group (AIG), the global insurance heavyweight with a market cap of $42.3 billion, has had a rough 12 months relative to the broader market. While the S&P 500 surged 26.9% over the past year, AIG shares slipped 5.9%. Year-to-date, the stock is down nearly 8%, compared to the S&P 500’s 5.5% gain. Even the financial sector, as tracked by the State Street Financial Select Sector SPDR ETF (XLF), rose 4.4% in the same period, leaving AIG in the dust.
But the narrative shifted after AIG reported its Q1 2026 results on April 30. Shares jumped 5.3% as the company posted adjusted EPS of $2.11 and adjusted pretax income of $1.5 billion, both beating expectations. Underwriting income more than tripled to $774 million, while General Insurance net premiums written grew 18% year-over-year. Investors also cheered an 11% dividend hike to $0.50 per share and $760 million in capital returned to shareholders. Management guided for low-to-mid teens premium growth in 2026, adding fuel to the optimism.
For the fiscal year ending December 2026, analysts expect adjusted EPS to rise 9.3% to $7.75. AIG has beaten consensus estimates in each of the last four quarters, giving the Street some confidence. Of the 24 analysts covering the stock, the consensus rating is “Moderate Buy,” with seven “Strong Buy,” two “Moderate Buy,” and 15 “Hold” ratings. On May 1, BofA raised its price target to $84 while keeping a “Neutral” rating. The mean price target of $86.91 implies a 10.7% upside from current levels, while the Street-high target of $101 suggests a potential 28.7% gain.
Still, not everyone is convinced. Mark Delaney, a portfolio manager in Chicago, said: “AIG’s Q1 was solid, but the stock has been dead money for a year. I’d need to see sustained underwriting improvement and premium growth before jumping in. Right now, it’s a show-me story.” Linda Torres, a retail investor from Miami, was more blunt: “I’m tired of hearing ‘Moderate Buy’ while my AIG shares keep dropping. The market is moving on without them. They need to stop talking and start delivering.” James Whitfield, an insurance analyst at a New York-based research firm, offered a measured take: “AIG’s core business is strengthening, and the dividend hike signals confidence. The stock is undervalued relative to peers, but the market needs to see consistent execution before rewarding it.”
On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com.