Using the industry peer median P/E multiple (trailing + forward), American International Group, Inc. (AIG) has a fair value of $54.36 based on 5 comparable companies in the Insurance - Diversified industry.
USD in millions except Fair Price. Subject company highlighted.
| Mkt Cap ($M) | Trailing P/E | Forward P/E | |
|---|---|---|---|
| American International Group, Inc.AIG | 42,479 | 13.7x | 14.8x |
| MetLife, Inc.MET | 45,997 | 14.5x | 8.0x |
| Ameriprise Financial, Inc.AMP | 41,845 | 12.4x | 11.6x |
| The Hartford Financial Services Group, Inc.HIG | 37,604 | 10.1x | 13.5x |
| Arch Capital Group Ltd.ACGL | 34,092 | 8.1x | 10.7x |
| Prudential Financial, Inc.PRU | 33,084 | 9.3x | 6.6x |
| Industry Median | 10.1x | 10.7x | |
| (*) Profit after tax | 3,096 | 2,879 | |
| Equity Value | 31,339 | 30,664 | |
| (/) Outstanding shares | 570 | 570 | |
| Fair Price | $55 | $54 | |
This P/E relative valuation uses the industry peer median Price-to-Earnings ratio to estimate fair value. Both trailing (last 12 months) and forward (next fiscal year analyst estimates) P/E multiples are computed independently.
The industry median trailing P/E is applied to the company's TTM net income, and the forward P/E to analyst-estimated net income. Each produces an equity value divided by shares outstanding to yield a fair price per share. The selected fair value is the average of the trailing and forward legs.