American International Spinoff Sends Stock Surging

The equity is on track to topple a major technical hurdle today

Deputy Editor
Oct 27, 2020 at 8:58 AM
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The shares of insurance company American International Group Inc (NYSE:AIG) are staging a rebound this morning, up 6.6% at $33.33 at last check, on news that its board just approved a plan to separate its life and retirement businesses from the rest of its operations. Peter Zaffino was named as president of the new spinoff, which will go into effect next year. 

On the charts, AIG is once again contending with its 200-day moving average, which snuffed out last week's rally attempt. Should these gains hold, however, the equity could close north of this trendline for the first time since mid-February. And while the shares have been middling since mid-June, the $28 level looks to be serving as a solid floor over the past few months. 

Analysts are warming to American International stock, with seven considering it a "buy" or better, compared to five "hold" ratings. Plus, the 12-month consensus price target of $36.50 is a 16.8% premium to last night's close. 

There's been a penchant for puts in the options pits. This is per AIG's 50-day put/call volume ratio of 1.32 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which stands higher than 89% of readings from the past year. This hints at a much healthier-than-usual appetite for long puts of late.

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