|
|
|
ONLINE FEATURES
Book Reviews
BW Video
Columnists
Interactive Gallery
Newsletters
Past Covers
Philanthropy
Podcasts
Special Reports
BLOGS
Auto Beat
Bangalore Tigers
Blogspotting
Brand New Day
Byte of the Apple
Economics Unbound
Eye on Asia
Fine On Media
Green Biz
Hot Property
Investing Insights
Management IQ
NEXT: Innovation
NussbaumOnDesign
Tech Beat
Working Parents
TECHNOLOGY
J.D. Power Ratings
Product Reviews
Tech Stats
Wildstrom: Tech Maven
AUTOS
Home Page
Auto Reviews
Classic Cars
Car Care & Safety
Hybrids
INNOVATION
& DESIGN Home Page Architecture Brand Equity Auto Design Game Room SMALLBIZ Smart Answers Success Stories Today's Tip INVESTING Investing: Europe Annual Reports BW 50 S&P Picks & Pans Stock Screeners Free S&P Stock Report SCOREBOARDS Hot Growth 100 Mutual Funds Info Tech 100 S&P 500 B-SCHOOLS Undergrad Programs MBA Blogs MBA Profiles MBA Rankings Who's Hiring Grads |  |
AUGUST 1, 2005
Is AIG Turning A Corner?  Seasoned large-cap value investor Saul Eisenberg loves a real bargain, especially those that the Street has cast aside -- such as American International Group (AIG
), which New York Attorney General Eliot Spitzer and the Securities & Exchange Commission are investigating for accounting fraud. Since the massive probe began in February, shares of the giant global insurer have plunged -- from 73 on Feb. 11 to 50 by Apr. 22.
Eisenberg, of M&R Capital Management, started buying in March, when AIG was at 56. Although most investors still view it as fraught with risks, Eisenberg sees AIG as a steal. "Crunching the numbers to get the probe's worst-case impact, we saw that AIG was way oversold," he says. He sees the stock, now at 60, hitting 75 in a year. Prior to AIG's five-year restatement of its financial results, the Street had expected the company to earn $5.24 a share in 2005. Recently, William Wilt of Morgan Stanley (MWD ) (which did banking for AIG) upped his 2005 forecast to $5 a share from $4.80, and his 2006 forecast to $5.40 from $5.35. He says it is increasingly likely that AIG will recapture business momentum. Bijan Moazami of investment firm Friedman, Billings, Ramsey Group (FBR ) says the foreign life/retirement services unit -- 29% of AIG's total revenues -- will be a key driver in its overall growth. Overseas operations are growing fast, particularly in Japan, India, and China. Note: Unless otherwise noted, neither the sources cited in Inside Wall Street nor their firms hold positions in the stocks under discussion. Similarly, they have no investment banking or other financial relationships with them.  By Gene G. Marcial
BW MALL
SPONSORED LINKS
Get BusinessWeek directly on your desktop with our RSS feeds.
Buy a link now! Add BusinessWeek news to your Web site with our headline feed. Click to buy an e-print or reprint of a BusinessWeek or BusinessWeek Online story or video. To subscribe online to BusinessWeek magazine, please click here. Learn more, go to the BusinessWeekOnline home page  | | |
 Copyright 2005, by The McGraw-Hill Companies Inc. All rights reserved.Terms of Use | Privacy Notice |
Printer-Friendly Version