No. of Recommendations: 1
AIG.ws

i've been buying these up and I think they represent an interesting opportunity.

these are very long dated warrants which expire in 2021

they offer the ability to buy the stock at $45 and the cost is about $15

Well that gets to an implied cost of $60 for AIG

This is basically AIGs present book value. Is AIG worth book value. Well its present ROE would suggest no - but there is no reason to believe that the present ROE is the companies true ROE

This company has been owned by government for 5 years - it is just now being released so I see this as a demutualization - much like the demutualization of stock exchanges

If AIG can get to an ROE of 10% then it is certainly worth book value and management has publicly said they will reach this goal in 2 years. They so far have over delivered on promises they have made.

If AIG then is worth book value or more you are getting the next 8 years of growth value for free

Can a demutualized company grow -oh yeah it can

this is going to be very interesting I think.....
Print the post  

Announcements

What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement