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Fundamental analysis: American International Group, Inc. (AIG)

Awarener score: 8.2

Conclusion

Note: All scores range from 1 (worst) to 10 (best). Conclusions are updated daily with closing stock prices and new reported quarterly financial statements.

Revenue score: 5.5

• Business has been slightly shrinking. It's been weak when measured against peer companies.
• American International Group, Inc. business trend stability is good. The higher the stability, the lower the risk. It looks somewhat better than rivals.

Margins score: 5.8

• AIG profit margins -on goods and services sold- are usually destitute. They stand bottom tier against rival companies.
• Business profit on sales tends to be sufficient. It's great when measured against competitors.
• Profits on sales made -available to repay debt and purchase properties- are usually good. They remain rather normal in relation to peers.
• Earnings -before income taxes and interests on loans taken- tend to be good in relation to total revenues. They're still worse than most similar companies.
• Profits -before income taxes- are usually good considering total sales, and remain substantially worse when measured against rivals.
• Total net profit tends to be good when confronted to sales. Company stands substantially worse when measured against comparable firms.

Growth score: 1.0

• American International Group, Inc. has an unknown gross margin growth, as there is not enough data to analyze. It's been impossible to compare to competitors.
• There is not sufficient data to estimate the operating income margin trend, which has been therefore unknown against comparable firms.
• In past years, the company couldn't always turn a profit -available to repay debt and purchase properties-, which compares last-in-rank when measured against peer enterprises.
• In the previous years, the firm couldn't always make a profit -before income taxes and interests on loans taken-. It turns to be a disappointment compared to similar stocks.
• In past years, at least once the company lost money -before income taxes-. It was bottom tier against rivals.
• In the previous years, the firm had at least a total net loss, and last-in-rank when measured against peer companies.
• The company lost money at least once in the past years. It's been a disappointment compared to industry peers.

Miscellaneous score: 6.0

• AIG had to pay sparse income taxes in relation to profits made in the past years. It's been worse than most peers.
• The company does not report R&D expenses. It's meaningless to measure in relation to competitors.
• We have insufficient data to estimate how effective is research and development effort. It stands unknown against rival companies.

Profitability score: 5.5

• American International Group, Inc. usually gets hardly sufficient returns on the resources it controls. It proves weak when measured against peer firms.
• The company normally gets sufficient proceeds -on the resources directly invested in the business-. They remain lacking compared to similar companies.
• There's usually some profitability -in relation to owned resources-. It ranks weak when measured against competitors.
• In the past, got barely sufficient returns -on the tangible resources it controls-. This metric is usually related to the industry in which operates and combines profitability versus reinvestment needs. It's weak when measured against comparable enterprises.

Usage of Funds score: 8.1

• AIG usually uses a sparse portion of genuine funds generated to buy or replace property, plant, or equipment. The need for reinvestments is modest. It stands weak when measured against rival firms.
• The company is usually not replacing property, plant, and equipment that gets old, instead using funds in something else. It can't keep forever, which is substantially worse when measured against industry peers.
• In the past twelve months it paid excellent dividends, considering the current stock price. It came slightly better than competitors.
• Has increased dividend payments in the past years. Business prospects may have improved. The company has behaved lacking compared to similar firms.
• Dividend payments usually represent a non-significant portion of genuine funds generation and are likely very safe. Sustainability looks well ranked against comparable companies.
• The company usually significantly reduces the pool of investors, resulting in fewer mouths feeding on the pie of profits. It remains a slight improvement compared to peer enterprises.
• Repurchase effectiveness metric is very complex. Run again in analytical mode if you're interested in a technical explanation. It stands impressive in relation to rivals.
• The company uses a non-significant portion of genuine fund generation to reward investors. The company is usually improving its financial position, and could greatly boost stockholder rewards if it wished so. It still looks great when measured against competitors.

Balance Sheet score: 4.4

• American International Group, Inc. has no intangible assets (like brands and goodwill) according to accounting books, which is safest. It happens to be top tier when measured against peer companies.
• The company has somewhat more short-term resources than short-term obligations. Liquidity concerns might not be that important. It turns to be in a very weak position compared to similar firms.
• A very minor portion of resources controlled were provided for with financial debt. Financial strength is solid. Company could increase debt if it wished so, to reinvest in business, to buy a smaller company or to reward stockholders. It remains worse than most rival firms.
• Controlled resources might be only very slowly turned into cash and equivalents, which is riskier. It looks below average when measured against rivals.
• For every dollar of short-term obligations, the company has enough dollars in cash and short-term receivables. It's in a very weak position compared to peer firms.
• For every dollar of short-term obligations, the company has few cents of cash and equivalents, which is bottom tier against similar enterprises.
• Usually, sales are on many months credit. It still ranks weak when measured against peers.
• Days of inventory outstanding are not known. It comes up as a big question mark against competitors.
• We could not gauge the normal operating cycle of the company. It happens to be a mystery against peers.
• Unfortunately, we had not enough data to estimate the days of payables outstanding. It ranks unknown against industry peers.
• Cash conversion cycle remains unknown, due to not having enough inputs. It's incomparable against similar companies.
• To what extent normalized EBITDA covers interest expenses is not known. It stands impossible to compare against rival firms.
• Business earnings have usually been reasonable when measured against loans taken. Cutting back reinvesting in the business, it could take more than five years to repay the obligations with current profitability. It ranks below average when measured against comparable enterprises.
• Fixed assets turnover remains undisclosed. It looks we cannot relate it to similar firms.
• Resource exploitation is very low when yearly sales are considered, business volume must be greatly increased. This metric is normally tied to the industry where the firm belongs. It's still mediocre against peer companies.

Valuation score: 8.5

• American International Group, Inc. looks very cheap in relation to profits and financial position. It happens to be weak when measured against competitors.
• Price-to-Tangible-Book-Value is a fairly complex metric. Run again in analytical mode if you're interested in a technical explanation. It remains in good shape compared to peers.
• In the past twelve months, the company generated extraordinary free funds in relation to the stock price, which stands slightly better than similar companies.
• The company usually generates plenty more genuine funds to cover up for its business needs. Surplus cash may be used to repay loans, to eventually buy new businesses, or to reward investors. Considering the financial position and stock price, at the current price the share looks to be very attractive. It's still similar to industry firms.
• In the past twelve months, the company has significantly rewarded investors, considering both dividends and share on the pie of earnings. It came up in good shape compared to peer ventures.
• The company is largely indebted. It should focus on loan repayment before rewarding stockholders. It looks bottom tier against similar enterprises.
• Considering the past twelve months, traditional Price-to-Earnings relation looks extremely cheap. Possible reasons are that the market might be betting current earnings will be very hard to sustain through time, or that the company has very high fund needs, a weak financial position, or that earnings aren't representative. If that isn't the case, the stock price could be extremely attractive. It ranks more than average in relation to peer companies.
• Comparing the current stock price with the past twelve-months revenues gives a not far from one-to-one relationship. This is an important metric to check its evolution through time, and to compare to industry peers. It looks excellent in relation to rival firms.
• The relation between the stock price and accounting book value might be more than reasonable. It's important both to check this metric through time and to compare it with rival companies. The company remains well ranked against peer firms.
• In the past twelve months, the operating business earned great money when compared to the current stock price and financial position. It happens to be almost average when measured against industry peers.
• In an alternate metric of bang for the buck, the company has usually shown an excellent earnings power ability when measured against the current stock price and financial position. Further analysis is recommended, as the stock might currently be undervalued. It's still lacking compared to peer companies.

Total score: 5.6

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Awarener score: 8.2

Conclusion

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