AIG's Stock Falls 0.51% Despite Strong Earnings Traded at 326th in Daily Volume

Market Snapshot

American International Group, Inc. (AIG) experienced a 0.51% decline in its stock price on November 5, 2025, closing at a reduced value. Despite the downward move, the company’s shares remained active in trading, with a daily volume of $0.42 billion, placing it at the 326th rank in market activity. The performance contrasts with the company’s strong earnings report, which highlighted a 77% year-over-year increase in adjusted after-tax income per diluted share to $2.20 and a 15% rise in net investment income. The stock’s modest decline suggests investor caution or a reassessment of valuation metrics, even as AIG reported robust underwriting results and strategic growth initiatives.

Key Drivers

AIG’s third-quarter 2025 earnings release underscored significant operational and strategic advancements, including a 77% year-over-year surge in adjusted after-tax income per diluted share to $2.20. This growth was driven by a 81% increase in underwriting income to $793 million, fueled by reduced catastrophe-related losses and favorable prior-year development. The company also announced strategic investments in Convex Group and Onex Corporation, as well as agreements to acquire renewal rights for Everest Group’s global retail commercial insurance portfolios. These moves are expected to enhance earnings, EPS, and ROE, reflecting AIG’s focus on capitalizing on industry relationships and expanding its market presence.

The insurance giant’s underwriting performance improved across key segments, with General Insurance reporting a 81% year-over-year increase in underwriting income. The North America Commercial segment saw a 300% rise in underwriting income to $384 million, attributed to lower catastrophe losses and reduced expenses. Similarly, the International Commercial segment recorded a 3% year-over-year growth in net premiums written to $2.1 billion, supported by expansion in Global Specialty and Property lines. However, the Global Personal segment faced challenges, with an 11% decline in reported net premiums written, driven by adverse impacts in the U.S. High Net Worth business.

Despite these gains, AIG’s stock faced downward pressure due to sector-specific headwinds and mixed investment performance. Net investment income on an adjusted pre-tax basis fell 21% year-over-year to $1.0 billion, primarily due to a favorable change in the fair value of its equity stake in Corebridge Financial. Additionally, pricing pressures in North America property insurance and a 4% decline in Global Personal premiums highlighted ongoing challenges in certain lines of business. Analysts noted that while AIG’s strategic investments and capital returns—$1.5 billion in shareholder distributions—were positive, the stock’s valuation metrics and technical indicators may have contributed to the modest decline.

Looking ahead, AIG’s management emphasized disciplined capital deployment and expense management as key priorities. The company aims to achieve an expense ratio below 30% by 2027 and reiterated confidence in surpassing investor day targets. Strategic acquisitions and partnerships, such as the Convex Group quota share and Everest Group renewal rights, are expected to drive accretive growth. However, investors remain cautious about potential volatility in reinsurance earnings and competitive pricing dynamics, particularly in the property and casualty segments. These factors, combined with AIG’s strong operational execution, position it for long-term resilience but may temper short-term price momentum.