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A Big Upgrade for AIG

By Dave Mock - Updated Apr 5, 2017 at 8:00PM

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This bullish call comes from more than just one analyst.

Every day, the sun rises on Wall Street, and a plethora of professional analysts wake to issue new opinions on stocks. Here at the Fool, we use our "This Just In" column to examine some of these picks -- and pick apart the track record of the firm behind them -- so individuals can make better investing decisions.

In addition to following professional banks, anyone can use Motley Fool CAPS to monitor the collective opinions of more than 120,000 members, many of whom demonstrate better investing insight than published analysts do.

While it may be hard to believe, more top-performing CAPS members are turning bullish on American International Group (NYSE:AIG) these days, with the stock being upgraded from its long held two-star rank to a more formidable three stars. A total of 2,434 members have given their opinion on AIG, with many of them offering analysis and commentary explaining the recent optimism.

After following up the original September bailout with a second act that brings the total to about $150 billion, the U.S. government has shown that it believes AIG is too big to fail. Bailout number two brought in additional capital that was needed to cover margin calls from the likes of Goldman Sachs (NYSE:GS), Morgan Stanley (NYSE:MS) and other counterparties on its credit derivatives, as well as prop up its deteriorating financial position. The new terms with the Fed call for lower interest rates and taking billions in toxic mortgage debt off of AIG's hands.

As the U.S. bailouts reach staggering amounts, AIG joins the list of companies -- including Fannie Mae (NYSE:FNM), Freddie Mac (NYSE:FRE), and Citigroup (NYSE:C) -- to which the government is committing trillions of dollars to ensure their survival. The new plan also buys AIG more time to sell off as much as $60 billion in assets to pay off debt. To this end, it's been working with JPMorgan Chase (NYSE:JPM) and several other banks to assist with the complex dismantling of divisions that span the globe.

While AIG will likely only be a shell of its former self in the future, many see AIG's recovery as crucial to the US government and see the low stock price as worthy of a look. To see everything the very best CAPS analysts are saying now about AIG -- as well as other winning stocks they are picking -- head on over to CAPS and have a look.

More Foolishness:

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Fool contributor Dave Mock recently upgraded his stocking to super-sized in preparation for buckets of coal. He owns no shares of companies mentioned here. JPMorgan Chase is an Income Investor pick. The Fool's disclosure policy is the paper equivalent of the wise old man sitting by the stream.

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Stocks Mentioned

American International Group, Inc. Stock Quote
American International Group, Inc.
AIG
$54.72 (2.19%) $1.17
Citigroup Inc. Stock Quote
Citigroup Inc.
C
$53.89 (3.46%) $1.80
JPMorgan Chase & Co. Stock Quote
JPMorgan Chase & Co.
JPM
$118.49 (2.70%) $3.11
The Goldman Sachs Group, Inc. Stock Quote
The Goldman Sachs Group, Inc.
GS
$348.23 (3.45%) $11.61
Morgan Stanley Stock Quote
Morgan Stanley
MS
$89.21 (3.30%) $2.85
Federal Home Loan Mortgage Corporation Stock Quote
Federal Home Loan Mortgage Corporation
FMCC
$0.63 (3.28%) $0.02
Federal National Mortgage Association Stock Quote
Federal National Mortgage Association
FNMA
$0.65 (2.38%) $0.02

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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