BofA Boosts AIG Price Target To $65

In a report published Tuesday, BofA Merrill Lynch analysts maintained a Buy rating on

, while raising the price objective from $63 to $65, citing "a higher present value of the deferred tax asset" and a lower share count. In the report BofA Merrill Lynch noted, "As part of our sum-of-the-parts valuation analysis, we include the present value of AIG's deferred tax asset. We start with the value on the balance sheet and discount that number based on our assumptions regarding when this DTA will be used. We had not changed this discount for several years but given the lower level of interest rates and the ongoing profitability of the company's operating units, we are reducing our discount (from $6 billion to $5.5 billion)." American International has accelerated the pace at which it repurchased shares. Given this and the expectation of an increase in the company's buyback program, results in a lower share count, which "modestly" boosts the price objective.