August 28, 2009
– Comments (10) |
RELATED TICKERS: AIG
I don't believe it but I might as well make Caps points with it so I started an outperform on it.
Good luck with that. I mean that sincerely.
That's a bet, not an investment. Last time I checked, they were still losing OOOODLES AND OOOOODLES of money.
10x current price?! I agree with jason. They could sell off the entire company in pieces and not even come close to covering their debt to the government. I would put a conservative estimate of fair value at $0. I wouldn't pay .1x current price for AIG.
jason2713, they aren't losing that much money. Their EPS is not too bad, just around -$700 EPS. :D
Funny... I actually red-thumbed it today... Figured if I should start moving away from my original plan of just having my real life picks in CAPs.
I gotta admit the one time profit was nice however when you look at their balance sheet and their debt to the government the only reason to invest is for a quick buck. Long term you'll be lucky if the company still exists in five years.
It's going to happen so bears just sit back and watch this one. Most of us who purchased this stock did so completely ready to loose everything I think. Now it seems the wind has changed. This stock was under .50 cents a share not that long ago. After the reverse split .50 equals $10.00 per. share and that today has gained hundreds of percents and will probably change to the higher in the morning. I am really sticking with this being AIG has one good hand to play. $$$$$$ We can't shut them down until we get our money back and they are sure as SH#% not going to pay us back before they become profitable. AIG is basically another FNM that is gaining some ground. Its a government owned company and is not going away.
The goverment will most likely keep them around for a while until they get paid back but the company wont be the same ever again and other than share price appreciation I doubt a dividend will ever happen again. Also they dont have much room for growth so still a more short term play imo.
Isn't the goverment pension fund held through AIG. That tells me that they won't let them fail. Infact I'll go as far as to say they'll stop at nothing to do it. Bet on goverment corruption.
Guys whats funnier is Barrons in Feb. 2008 saying AIG will rally 50% when it had fallen to $45 basically saying its worth $65-$70/shr
If you add the 1-20 reverse split that would be a current price of
$1,300/shr - $1,400/shr at todays value.
Barrons has lost all crediability on all calls up or down. T
in the company's accounting systems, which forced it to boost a $1.6 billion writedown on its credit insurance to a whopping $5.2 billion. Investors worry that since the writedown only covered losses until the end of November, things could get worse once the books are adjusted to reflect an even-weaker December and Q1 2008.
Barron's suggests the worry is largely a big to-do over nothing, because the accounting loss is just that -- a book-based change based on complicated accounting conventions that will have little-to-no effect on the company's bottom line. The mark-to-market writedowns will make their way back into AIG's earnings over the coming years as the mortgage loans backing the CDOs pay down. In a recent analysis, the absolute worst pretax loss it could suffer on its $63 billion insurance portfolio is just $590 million, not much considering AIG's $104B market cap and book value of $42/share. At Friday's $45.50, shares trade for just 1.1x book value -- which should hit $46.87 by year-end. Bear in mind, shares traded for 4x book value less than ten years ago. Barron's says the stock could jump nearly 50%.