In the video below, Fool analyst Matt Koppenheffer discusses some key areas that investors in AIG should be watching.
The first area is management. CEO Robert Benmosche, who took over after the company was bailed out, has done a fantastic job bringing the company back from the brink, Matt says. Non-core operations have been sold off. The balance sheet has been repaired.
The problem is, he won't be the long-term CEO. He came out of retirement to lead AIG, and will be returning to retirement in the near future. The succession plan is important.
AIG's reaction to interest rates is the second area to watch, Matt says. A big part of the insurance business is hanging on to customers' premiums and investing the money. When interest rates are low like they have been, it's tougher for insurers to make money.
The final piece to watch is the performance of the core businesses at AIG, the property and casualty insurance business and life insurance business. With others assets shed, their performance is key to the company's success.
After AIG brought the financial world to its knees, most investors are wary about owning a stake in the company today. We'll fill you in on both reasons to buy and reasons to sell AIG, and what areas AIG investors need to watch going forward. Just click here now for instant access.
The article 3 Areas You Must Watch at AIG originally appeared on Fool.com.
Matt Koppenheffer has no position in any stocks mentioned. The Motley Fool recommends American International Group. The Motley Fool owns shares of American International Group, and has the following options: Long Jan 2014 $25 Calls on American International Group. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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