Reuters: Financial Services and Real Estate: UPDATE 1-Goldman upgrades AIG, cuts ACE

Reuters: Financial Services and Real Estate Reuters.com is your source for breaking news, business, financial and investing news, including personal finance and stocks. Reuters is the leading global provider of news, financial information and technology solutions to the world's media, financial institutions, businesses and individuals. // via fulltextrssfeed.com

UPDATE 1-Goldman upgrades AIG, cuts ACE May 9th 2012, 12:22 Wed May 9, 2012 8:22am EDT * Raises AIG to "buy" from "neutral" * Upgrades AIG on signs of progress at property insurance unit * Cuts ACE to "neutral" from "buy" * Removes ACE from Americas conviction buy list May 9 (Reuters) - Goldman Sachs upgraded American International Group to "buy" from "neutral," citing early signs of progress at its global property insurance unit. Chartis, the largest unit of AIG, returned to profitability in the fourth quarter. It earned $1 billion in the first quarter, compared with a loss of $424 million a year earlier. Improving pricing will help Chartis' earnings, Goldman Sachs said. "We continue to hear from the marketplace that AIG is taking a very disciplined approach to pricing," they said. This will boost the company's profitability in the long term even as it is unlikely to manifest in earnings immediately, said the analysts, including Michael Nannizzi. Nannizzi is rated four stars by Thomson Reuters StarMine for the accuracy of his earnings estimates on the companies he covers. "Near term we expect non-core asset sales to continue to support buybacks, and longer term ... we believe progress at Chartis will provide further upside," Goldman analysts said. Goldman Sachs raised its price target on AIG stock to $40 from $31. The analysts, however, downgraded insurer ACE Ltd to "neutral" from "buy," and removed the stock from its Americas conviction buy list. While ACE remains a clear leader in the industry with scale and global reach, its diversified presence limits the benefit that better commercial pricing in the United States will provide, Goldman analysts said. Shares of ACE closed at $75.82 on Tuesday on the New York Stock Exchange, while those of AIG closed at $31.70. Link this Share this Digg this Email Reprints

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