Principal Financial (PFG) AI Stock Analysis

• Market Cap: $17.04B
• Dividend Yield: 3.87%
• Average Volume (3M): 1.20M
• Price to Earnings (P/E): 15.4
• Beta (1Y): 0.94
• Revenue Growth: -3.34%
• EPS Growth: -3.32%
• Country: US
• Employees: 19,700
• Sector: Financial
• Sector Strength: 71
• Industry: Insurance - Diversified
• EPS (TTM): 2.16
• Shares Outstanding: 222,768,450
• 10 Day Avg. Volume: 1,723,758
• 30 Day Avg. Volume: 1,200,072
• PEG Ratio: 0.07
• Price to Book (P/B): 1.58
• Price to Sales (P/S): 1.09
• P/FCF Ratio: 3.86
• Enterprise Value/Market Cap: 1.31
• Enterprise Value/Revenue: 1.42
• Enterprise Value/Gross Profit: 3.29
• Enterprise Value/Ebitda: 17.33
• 1Y Price Target: $85.17
• Price Target Upside: 10.27% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 13

• Rating: 72 Outperform
• Price Target: $85.00 ▲(10.05% Upside)

Principal Financial Group's overall stock score reflects strong financial performance, particularly in cash flow management and profitability. Challenges include recent bearish technical indicators and market volatility affecting revenue. The company's strategic initiatives and leadership changes are expected to drive long-term growth, while valuation metrics suggest moderate market expectations.

Positive Factors

Asset Management Earnings

Asset management earnings of $236 million outpaced the consensus expectation of $221 million, with higher management and performance fees contributing to revenue growth and expanded operating margin.

Corporate Expenses

Corporate and Other earnings of $(81) million finished better than the consensus expectation of $(99) million, driven by higher net investment income and lower operating expenses.

Negative Factors

Investment Management Net Outflows

Investment Management saw $4.2bn in net outflows in the quarter due to a couple large accounts exiting the fund complex.

Net Fund Flows

Net fund flows declined somewhat across RIS, Investment Management, and International Pension, all below consensus.

Retirement & Income Solutions Earnings

Retirement & Income Solutions had underlying pre-tax earnings that missed consensus, driven in part by lower than expected net fund flows.

Principal Financial Business Overview & Revenue Model

Company Description

Principal Financial Group (PFG) is a global financial services company headquartered in Des Moines, Iowa. It operates primarily in the sectors of insurance, retirement planning, and asset management. PFG offers a range of products and services including individual and group insurance, retirement solutions such as 401(k) plans, investment management, and financial advisory services. The company serves a diverse clientele, including individuals, small businesses, and large corporations, aiming to help them achieve financial security and stability.

How the Company Makes Money

Principal Financial Group generates revenue through several key streams. Its primary sources of income include premiums from life and health insurance products, fees from asset management services, and commissions from retirement plan services. The company earns premiums from its insurance offerings that provide financial protection to individuals and businesses. Additionally, it collects management fees on assets under management in its investment portfolios, which include mutual funds, retirement accounts, and other investment products. PFG also generates revenue through advisory services related to financial planning and investment strategies. Significant partnerships with financial institutions and corporations enhance its distribution channels and broaden its market reach, further contributing to its earnings.

Principal Financial Financial Statement Overview

Summary

The company shows robust profitability with a strong Gross Profit Margin and a moderate Net Profit Margin of 8.60%. Operational efficiency is indicated by an EBIT margin of 12.89%, but revenue growth has been volatile with a 25.15% decline from 2022 to 2024. The Balance Sheet is stable with good leverage management, though high reliance on liabilities is typical for the industry. Cash Flow is strong, with excellent cash conversion and utilization.

Income Statement

The Income Statement shows robust profitability with a strong Gross Profit Margin consistently at 100% due to the nature of the industry. The Net Profit Margin stands at 8.60% for the TTM (Trailing-Twelve-Months), showing profitability but with room for improvement. Revenue growth has been volatile, with a notable decline of 25.15% from 2022 to 2024. EBIT Margin for TTM is 12.89%, indicating operational efficiency, while EBITDA Margin is 9.21% reflecting decent operating performance.

Balance Sheet

The Balance Sheet reflects a stable financial structure with a Debt-to-Equity Ratio of 0.39, indicating good leverage management. Return on Equity (ROE) for TTM is 9.26%, which is moderate, showing efficient use of equity to generate profits. The Equity Ratio is 3.58%, suggesting a high reliance on liabilities which is typical in the insurance industry but could pose risks if not managed carefully.

Cash Flow

The Cash Flow Statement indicates strong cash generation with a Free Cash Flow Growth Rate of 8.68% from the previous year. The Operating Cash Flow to Net Income Ratio is 4.81, demonstrating excellent cash conversion. The Free Cash Flow to Net Income Ratio is 4.74, highlighting efficient cash utilization relative to reported earnings.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	15.77B	16.13B	13.67B	17.54B	14.43B	14.74B
Gross Profit	6.79B	7.35B	5.90B	11.04B	7.08B	6.46B
EBITDA	1.29B	2.15B	1.01B	6.28B	2.19B	1.95B
Net Income	1.09B	1.57B	623.20M	4.76B	1.58B	1.40B
Balance Sheet
Total Assets	313.00B	313.66B	305.05B	303.00B	321.21B	313.47B
Cash, Cash Equivalents and Short-Term Investments	3.88B	29.94B	27.19B	67.74B	80.49B	81.56B
Total Debt	4.35B	4.11B	3.99B	4.08B	4.36B	4.36B
Total Liabilities	301.41B	302.19B	293.84B	292.70B	304.70B	296.60B
Stockholders Equity	11.22B	11.09B	10.92B	10.00B	16.13B	16.56B
Cash Flow
Free Cash Flow	4.93B	4.53B	3.69B	3.06B	3.09B	3.63B
Operating Cash Flow	5.00B	4.60B	3.79B	3.17B	3.22B	3.74B
Investing Cash Flow	-5.01B	-5.40B	-1.35B	1.06B	-5.66B	-5.03B
Financing Cash Flow	-279.20M	300.30M	-2.59B	-1.72B	1.92B	1.62B

Principal Financial Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 77.24
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PFG, the sentiment is Negative. The current price of 77.24 is below the 20-day moving average (MA) of 78.41, below the 50-day MA of 78.33, and below the 200-day MA of 79.50, indicating a bearish trend. The MACD of -0.79 indicates Positive momentum. The RSI at 46.64 is Neutral, neither overbought nor oversold. The STOCH value of 37.74 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for PFG.

Principal Financial Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HIG	79 Outperform	$36.28B	11.70	19.55%	1.57%	7.67%	15.99%
ACGL	78 Outperform	$33.55B	9.28	17.09%	―	23.79%	-32.09%
PFG	72 Outperform	$17.04B	15.40	10.16%	3.87%	-3.34%	-3.32%
AEG	70 Neutral	$11.66B	16.39	9.36%	5.34%	-5.03%	―
EQH	65 Neutral	$16.43B	44.23	34.30%	1.86%	5.05%	-47.26%
Sector *	62 Neutral	AU$10.41B	9.91	13.11%	4.73%	32.38%	21.40%
AIG	58 Neutral	$43.56B	14.57	7.61%	2.10%	-33.87%	-5.72%

Principal Financial Corporate Events

Principal Financial Advises Against Potemkin’s Mini-Tender Offer

Principal Financial Group, Inc. has received an unsolicited mini-tender offer from Potemkin Limited to purchase up to 100,000 shares of its common stock at a price significantly lower than the market value. On July 17, 2025, the company advised shareholders against accepting this offer, emphasizing that it does not endorse or associate with Potemkin’s proposal, and provided guidance for those who have already tendered their shares on how to withdraw them.

The most recent analyst rating on (PFG) stock is a Sell with a $68.00 price target. To see the full list of analyst forecasts on Principal Financial stock, see the PFG Stock Forecast page.

Principal Financial Reports $752.7 Billion Assets Under Management

As of June 30, 2025, Principal Financial Group reported assets under management totaling $752.7 billion, with a significant portion managed by Principal Asset Management’s Investment Management and International Pension divisions. The company’s strategic allocation during market fluctuations highlights its emphasis on diverse equity and fixed income products, reflecting its adaptability and potential impact on stakeholders.

The most recent analyst rating on (PFG) stock is a Sell with a $75.00 price target. To see the full list of analyst forecasts on Principal Financial stock, see the PFG Stock Forecast page.

Principal Financial Holds Annual Shareholders Meeting

On May 20, 2025, Principal Financial Group, Inc. held its annual shareholders meeting where key decisions were made. The shareholders elected Class III directors for a term ending in 2028, approved executive compensation, and ratified the appointment of independent registered public accountants, indicating continued stability and governance focus within the company.

The most recent analyst rating on (PFG) stock is a Sell with a $75.00 price target. To see the full list of analyst forecasts on Principal Financial stock, see the PFG Stock Forecast page.

Principal Financial Appoints New CFO Joel Pitz

On May 19, 2025, Principal Financial Group appointed Joel Pitz as Executive Vice President and Chief Financial Officer, succeeding Deanna Strable. Pitz, who has been with the company since 1995, previously served as Senior Vice President and Interim CFO. His extensive experience in aligning financial strategy with business goals is expected to benefit the company as it continues to pursue sustainable growth and value creation for stakeholders.

The most recent analyst rating on (PFG) stock is a Sell with a $75.00 price target. To see the full list of analyst forecasts on Principal Financial stock, see the PFG Stock Forecast page.