AIG Earnings: Underlying Trends Hold Steady

Over the past year, AIG has demonstrated its ability to start earning acceptable returns. The core annualized ROE for the second quarter came in at 9%, which is a slight step back from recent results, but still acceptable, in our view. We hesitate to make too much of a moderate quarterly deviation, and the metrics we are focused on stayed strong in the quarter. We will maintain our $72 per share fair value estimate and see shares as about fairly valued at the moment.