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come out stronger following catastrophic events as the weaker ones are forced out.
Insurance companies are also some of those most stable companies in the marketplace and are a favorite of Warren Buffett, one of the world’s greatest investors. Although Buffett is not directly involved with AIG, his investment vehicle Berkshire Hathaway (NYSE:BRK.B) owns a number of companies in insurance, including Geico and General Re.
S = Support is Provided By Institutional Investors & Company Insiders
AIG is owned by some of the biggest names in the investment world. The company is owned by George Soros, Steven Cohen of SAC Capital, Daniel Loeb of Third Point, as well as well-known value investor Bruce Berkowitz. It is always to be on the same side as smart money, and well, these funds and investors have proven to be smart money over and over and over again. Having them oversee management provides further support of continued shareholder-friendly moves by management.
Insurance services are going to continue to be in demand by consumers and businesses. As AIG continues to streamline its operations and use its excess cash in shareholder-friendly ways, the supply of AIG’s shares on the market should continue to shrink, providing a nice boost to shareholders. That combined with the points mentioned above, make AIG an OUTPERFORM in the long run.
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