Q4 earnings beat on EPS puts American International Group (AIG) in focus
American International Group (AIG) recently reported Q4 2025 earnings per share of US$1.96 on revenue of US$6.55b, topping EPS expectations while revenue came in below estimates and putting the stock on many investors' watchlists.
See our latest analysis for American International Group.
The Q4 surprise on earnings comes as AIG’s 7 day share price return of 3.39% contrasts with a 90 day share price decline of 10.62%. At the same time, the 5 year total shareholder return of 81.26% points to a stronger longer term record. This suggests momentum has recently cooled after a solid multi year run.
If earnings put AIG back on your radar, it can help to see what else the market is pricing in right now by scanning 20 top founder-led companies
With Q4 earnings beating EPS expectations, a recent pullback in the share price, and AIG trading below the average analyst price target, the key question now is whether there is genuine value here or if the market is already pricing in future growth.
Most Popular Narrative: 13.4% Undervalued
With AIG last closing at $75.42 against a narrative fair value of $87.10, the current setup leans toward a discount that hinges on how earnings and margins evolve from here.
The acceleration of digitalization and artificial intelligence initiatives such as the Gen AI deployment across underwriting and claims positions AIG to enhance operational efficiency, improve underwriting precision, reduce fraud, and offer more tailored insurance products, supporting improved net margins and sustained earnings growth.
Want to see what sits behind that margin story and fair value gap? The narrative leans on steady revenue progress, firmer profitability and a leaner share count. The exact mix of those drivers might surprise you.
Result: Fair Value of $87.10 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, softer P&C pricing and AIG’s exposure to climate driven catastrophe losses could still pressure margins and challenge the current undervaluation narrative.
Find out about the key risks to this American International Group narrative.
Another Angle On AIG’s Valuation
While the narrative fair value points to AIG looking 13.4% undervalued, the current P/E of 13x sits above the US Insurance industry at 11.4x, the peer average at 9.1x, and even its own fair ratio of 12.5x. That richer multiple can limit upside if sentiment cools. Which signal do you trust more right now?
See what the numbers say about this price — find out in our valuation breakdown.
Next Steps
If this all sounds cautiously optimistic, now is the moment to look through the numbers yourself and decide how compelling AIG really is. To see what the market is currently rewarding, review the 4 key rewards.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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