Why AIG Is Rising Despite Q4 Earnings Miss

By Chris Lange Updated Jan 13, 1:15PM EST · Published Feb 12, 11:05AM EST

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American International Group Inc. (NYSE: AIG) reported its fourth-quarter financial results after the markets closed on Thursday. The company had a net loss of $1.10 per share on $13.49 billion in revenue, although the consensus estimate had called for a net loss of $0.93 per share. In the same period of the previous year, AIG posted $0.97 in earnings per share (EPS).

The board of directors announced that it will add two more seats for a total of 16. The board will nominate its existing board of directors, as well as John Paulson, president of Paulson & Co., and Samuel Merksamer, a managing director of Icahn Capital, as the slate of directors to be included in AIG’s proxy statement for election at the 2016 AIG annual meeting of shareholders.

In addition, the board of directors approved a $5 billion share repurchase authorization and announced that it will increase its quarterly dividend by 14% to $0.32 per share. That will be payable on March 28 for shareholders as of March 14.
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Peter D. Hancock, president and CEO of AIG, commented on earnings:

At the beginning of 2015, we embarked on a three-year plan to transform AIG. Over the past year, we have been implementing our strategy and made significant progress towards our objectives. During the fourth quarter, we streamlined our management structure to accelerate decision-making and strengthen accountability. Our recent strategy update detailed the next chapter of our transformation into a leaner, more profitable and focused insurer.

Shares of AIG were trading up 4.8% at $52.94 on Friday, with a consensus analyst price target of $66.39 and a 52-week trading range of $50.38 to $64.93.

About the Author Chris Lange →

Chris Lange is a writer for 24/7 Wall St., based in Houston. He has covered financial markets over the past decade with an emphasis on healthcare, tech, and IPOs. During this time, he has published thousands of articles with insightful analysis across these complex fields. Currently, Lange's focus is on military and geopolitical topics.

Lange's work has been quoted or mentioned in Forbes, The New York Times, Business Insider, USA Today, MSN, Yahoo, The Verge, Vice, The Intelligencer, Quartz, Nasdaq, The Motley Fool, Fox Business, International Business Times, The Street, Seeking Alpha, Barron’s, Benzinga, and many other major publications.

A graduate of Southwestern University in Georgetown, Texas, Lange majored in business with a particular focus on investments. He has previous experience in the banking industry and startups.