Why American International Group Inc (AIG) Is Headed Higher This Morning

Page 1 of 2

The first three days of this week have not been kind to American International Group Inc (NYSE:AIG). As the company continues to manage expectations for a deal gone slightly askew, investors are left wondering if the insurer will be left with more risk on its hands. Plus the entire market is waiting on pins and needles for the Federal Open Markets Committee announcement and subsequent speech from Fed Chairman Ben Bernanke this afternoon. So what is propping up American International Group Inc (NYSE:AIG) this morning? Just an hour into trading, the company is up 0.93%.

American International Group Inc (NYSE:AIG)

Fed first
With so much riding on the announcement from Bernanke and the FOMC, there are sure to be big swings in the market later today. If the current QE plan stays intact, then there may be a huge sigh of relief from investors who jump further into the market; if there are cuts to the policy, shares will probably fall. For American International Group Inc (NYSE:AIG) investors, these swings aren’t something you have to participate in — it will happen marketwide, and if you’re keeping your eye on the long term, the effects of a cut to the stimulus policy will benefit the market (and American International Group Inc (NYSE:AIG)) later on.

Dead deal?
American International Group Inc (NYSE:AIG) has been in the process of selling off non-core businesses and refocusing its efforts on the fundamentals of insurance. As part of the sales, the insurer has been working with a consortium on Chinese financial firms to sell its aircraft leasing operations. The deal, however, has fallen on some tenuous ground, with delays pushing back closing and causing some concerns for investors. Right now, American International Group Inc (NYSE:AIG) has given the Chinese firms until the end of July to close the deal, but it has expressed an openness to new offers. And should the deal fall through, the world’s second largest leasing business will likely go IPO.

As an AIG investor, or someone interested in the company, the current state of the sale should not be causing as much panic as the headlines are suggesting. The original deal was for far less than management had originally wanted to sell the operations for, leaving room for new offers to better the current $4.2 billion price tag. And if there are no new offers and an IPO is the final route, AIG is well qualified to handle that situation and come out on top.

Page 1 of 2

Biotech Insider Alert - $6 Stock To Hit $40

$200 Million Dollar Healthcare Hedge Fund's #1 Best Idea Right Now

The best healthcare hedge fund out there right now is one of the largest shareholders in this biotech stock. The fund returned more than 20% in each of the last 2 years with a virtually fully hedged portfolio, and it's sending out a BUY signal on this biotech stock. Get your FREE REPORT today (retail value of $300)

This is a FREE report from Insider Monkey. Credit Card is NOT required.
Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

The World’s Most Famous Circuses

Best Hair Stylists

Most Popular NASCAR Drivers

The Best Romance Movies of all Time

The Most Wanted Drug Lords

The Oldest Money Managers

The Greatest Directors in the World

Largest Animals in the World

World’s Most Expensive Desserts

Best Selling Comic Books of All Time

A-list Actors who Sabotaged Their Career

Rappers With a College Degree

The Best Jazz Albums of all Time

The Most Influential Jazz Musicians

The World’s Most Famous Photographers

The Best Oscar-Winning Songs

Most Influential Choreographers Ever

Most Expensive Department Stores in the World

The Most Expensive Stolen Paintings in the World

The World’s Most Expensive Teas

Top Oscar Record Holders

The Most Expensive Flowers in the World

Countries With a Booming Film Industry

Most Expensive Cupcakes in the World

Uncommon European Escapes

The Most Stolen Artists in History

Best Travel Destinations in Australia

World’s Most Expensive Musical Instruments

World’s Most Famous Animals

Most Expensive Cakes in the World

Most Expensive Kosher Champagne in the World

Most Expensive Kosher Wine in the World

The Most Surprisingly Dark Fairy Tales

Most Popular Travel Destinations in Asia

The 10 Most Expensive Dresses Ever Worn to the Oscars

World’s Most Visited Art Museums

Best Countries for Photographers to Work in

Best Paid Jobs in the Film Industry

The Most Renowned Recovered Paintings Ever

Child Stars That Turned out Just Fine

Books That Were Banned in the Past Century

World’s Richest Dancers

Best Remedies against Bad Breath

Foods That Improve Your Skin Texture

Best-Selling Children’s Books of all Time

Foods That Boost Your Libido

Best-Selling Books of all Time

The Most Expensive Academy Awards Jewelry in History

Most Expensive Japanese Restaurant In New York City

The Best B-Boy Movies

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 129% in 2.5 years!! Wondering How?

Download a complete edition of our newsletter for free!