NEW YORK (CNNMoney.com) - The nightmare may finally be over for AIG but investors aren't rushing back into the stock - not yet.

It's been a rough 18 months for American International Group (Charts). The world's biggest insurer got hit by an accounting probe after New York Attorney General Eliot Spitzer and the SEC started investigating allegations of bid-rigging that rocked the industry in the fall of 2004.

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The following spring, AIG lost its long-time CEO, and then came last year's hurricanes that cost the industry billions.

The cascade of bad news has left AIG shares about 16 percent below their 52-week high and 7 percent below the price the day before legendary ex-CEO Maurice "Hank" Greenberg was forced to resign in March 2005.

But are investors ready to re-embrace a company that was once widely loved on Wall Street? Not so fast.

Cliff Gallant, managing director at Keefe, Bruyette & Woods, said investors may want to give AIG a second look now that the company has settled its regulatory issues and embarked on a number of corporate governance reforms under the leadership of Martin Sullivan, who succeeded Greenberg on March 14, 2005.

Among the changes: new, independent directors and restated earnings after regulators said the company artificially boosted its numbers with accounting gimmicks.

The changes came as the industry reeled from scandal following Spitzer's probe of bid-rigging among insurers. Marsh & McLennan (Charts), which was headed at the time by Greenberg's son Jeff, was the first to undergo scrutiny in October of 2004, and the investigation eventually brought regulators knocking at AIG's door.

As the company battled those charges, Spitzer accused AIG of inflating its own profits using aggressive accounting measures. Both Greenberg and the company's CFO Howard Smith resigned under pressure from the company's board of directors, setting off an avalanche of stock sales and investor disillusionment.

AIG, which once traded at 35-times forward-looking earnings during its peak in 1999 and 2000 is now trading at around 11 times 2006 earnings forecasts of $5.45 a share, said Michael Paisan, principle at research firm Stifel Nicolaus.

But with Greenberg now out of the picture, the company settled civil charges of bid-rigging and fraud for $1.6 billion - the largest regulatory settlement ever by a single company - and AIG appeared poised to move forward.

Investors, however, remain skeptical.

With its diverse international portfolio and strength in its property-casualty business, AIG may be an investment for the long run, Gallant said. But while he rates the company a "buy," he warned that earnings will be less predictable.

"In the old days, under Hank, they used to be within a penny of expectations," he said "AIG is positioned very well for record profitability but in a post-Hank era, expect more earnings volatility."

In fact, results in recent quarters have been hammered by big one-time charges.

AIG's most recent first quarter report, for instance, included a $115 million charge related to AIG's split from C.V. Starr - a subsidiary with ties to former CEO Greenberg - and $95 million for credit-card losses in Taiwan and higher advertising costs in it's commercial and industrial property-casualty unit.

Wall Street, surprised by the charges as well as weakness in AIG's life insurance operations, sent the stock tumbling after the report, and the shares haven't recovered.

Stifel Nicolaus's Paisan said he expects more noise in upcoming reports. And while the stock may be more attractive at current prices, he said investors should proceed with caution.

"The investigations and fines are behind them," Paisan said. "There was heavy concentration on the SEC and Spitzer's inquiries, but now it's time to scrutinize the business, look under the sheets and see what's there."

He said more charges may be coming if the New York-based company finds evidence of overly aggressive business practices.

Still, analysts said that given it's solid core business and the changes implemented by Sullivan, AIG stock could be a good long-term bet.

Donald Light, senior analyst at independent research and consulting firm Celent LLC, said one key issue is whether Sullivan will be the powerhouse that Greenberg was for four decades at the helm. He added that from a business perspective, the company is in solid shape.

"Overall the machine is working quite well," he said. "I think when somebody replaces a legend, there's going to be a period of time to determine whether this person is a new legend or no legend at all."

In the meantime, the company is well-positioned to ride out the current hurricane season, which some are predicting to be severe.

Wall Street has been cautious about insurers since the hurricane season began last month. Last year's barrage of storms cost the industry $57 billion, according to Insurance Services Office, a firm that advises property-casualty insurers.

Unlike an insurer like Allstate (Charts), AIG is not a large personal lines insurer that deals with home and auto insurance -- a fact that will help insulate the company from severe losses if there's another round of deadly hurricanes this year, analysts said.

And AIG spokesman Christian Murray said AIG cut its insured exposure to hurricanes by 3 percent to 5 percent. Analysts said that should also put a plus mark in AIG's column.

Still, investors may need to be patient.

"New money may not want to go rushing into the stock until there is a better understanding of what the company will be," said Stifel Nicolaus' Paisan. "At some point, it makes sense to own it but in my opinion, there is still a lot of uncertainty of what AIG will ultimately look like."

Keefe, Bruyette & Woods' Gallant owns shares of AIG and the firm has an investment banking relationship with the company. Neither Celent's Light or Stifel Nicolaus' Paisan own shares of the company and their firms don't have an investment banking relationship with AIG.

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