Volatile Stock to Watch: American International Group Inc (NYSE: AIG)

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American International Group Inc (NYSE: AIG) stock fell over 0.5% in the pre-market session of Feb 17th, 2021 (Source: Google finance) after the company’s fourth quarter of FY 20. The company has delivered a net loss of $60 million in the fourth quarter, mainly due to a $1.2 billion loss from derivatives. For the full year, AIG has reported a $6 billion net loss, mainly due to its sale of Fortitude Group Holdings LLC last June. But it met analysts’ estimates with full-year adjusted earnings of $2.2 billion.

The company has posted 4% rise in fourth-quarter adjusted pre-tax income to $809 million for its general insurance. For its life and retirement segment, the fourth-quarter adjusted pre-tax income rose 20% to $1.027 billion driven by diverse products and distribution strength. AIG did not provided a 2021 outlook and has also suspended such guidance after the first quarter of 2020. The company has also did not provide an update on the plan to exit the life and retirement business that it announced last year.

Moreover, the adjusted book value per common share was $57.01, which reflects an increase of 0.4% compared to September 30, 2020 due to unrealized gains on the investment portfolio. ROCE and Adjusted ROCE were (9.4)% and 4.4%,respectively, for the twelve months ended December 31, 2020 and (0.4)% and 6.7%, respectively, on an annualized basis for the fourth quarter of 2020. AIG in the fourth quarter of FY 20 has reported the adjusted earnings per share of 94 cents.

Additionally, at the end of December, 2020, AIGParent liquidity stood at approximately $10.5 billion compared to $7.6 billion at December 31, 2019. In December 2020, the company had repaid $708 million total principal amount of its 6.400% Notes Due 2020. AIG’s total debt and preferred stock leverage at the end of December, 2020 was 28.4%. On February 1, 2021, AIG repaid $1.5 billion total principal amount of its 3.300% Notes Due 2021. The company has declared a quarterly cash dividend of $0.32 per share on AIG Common Stock, par value $2.50 per share. The company has also declared a quarterly cash dividend of $365.625 per share on AIG Series A 5.85% Non-Cumulative Perpetual Preferred Stock, with a liquidation preference of $25,000 per share.

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