Whitney Tilson’s Bullish Presentation on AIG

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Whitney Tilson's Bullish Presentation on AIG

Snapshot:

• American International Group, Inc. (NYSE:AIG) is a leading global multi-line insurance company with well-managed, sustainable global franchises

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• AIG today is far different from the risky pre-crisis AIG

• Lingering taint from the crisis plus the overhang of US Treasury ownership result in the stock trading at a 41% discount to tangible book value

• We think AIG is worth at least 1x tangible book, and see numerous catalysts in the next year or two to close the valuation discrepancy

• As the US Treasury?s stake declines (likely in part due to Company repurchases) and the stability and growth of AIG?s core franchises become clear, the market will re-value AIG

The Basics:

• Stock price (5/7/12): $31.84

• Shares outstanding: 1.79 billion

• Market cap: $57.0 billion

• Net debt: $74 billion

• Book value: $103.5 billion

• Book value per share: $57.68

• Tangible book value per share: $53.85

• Price/book: 0.55x

• Price/tangible book: 0.59x

• Float: 40% (government owns 60% after today?s offering)

• Short interest: <1%

AIG Today:

• Today AIG is a leading, financially sound multi-line insurance Company focused on its core businesses
• Quality, market-leading franchises in both property & casualty insurance (Chartis) and US life & retirement (SunAmerica) account for ~90% of revenue

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