Prudential Financial (PRU) AI Stock Analysis

• Market Cap: $36.40B
• Dividend Yield: 5.11%
• Average Volume (3M): 2.04M
• Price to Earnings (P/E): 13.7
• Beta (1Y): 0.94
• Revenue Growth: 34.25%
• EPS Growth: 11.22%
• Country: US
• Employees: 37,936
• Sector: Financial
• Sector Strength: 87
• Industry: Insurance - Life
• EPS (TTM): 7.48
• Shares Outstanding: 354,427,100
• 10 Day Avg. Volume: 1,471,630
• 30 Day Avg. Volume: 2,039,004
• PEG Ratio: 1.22
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.00
• Price to Cash Flow (P/CF): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 2.01
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: 1.04
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $112.91
• Price Target Upside: 10.99% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 11

Prudential Financial presents a mixed picture with strong cash flow and valuation attractiveness but faces significant challenges in financial stability due to high leverage and negative equity. While technical indicators are bearish, earnings call insights and corporate events suggest strategic growth and solid shareholder returns. The company needs to address underlying financial concerns to improve its overall standing.

Positive Factors

Earnings and Growth

PRU is targeting earnings growth of low double-digits for PGIM and mid single-digits for US Businesses.

International Performance

Both Life Planner and Gibraltar saw better than expected results, with higher net investment spread partially supporting earnings.

Strategic Deals

The recent Prismic deal is seen as a positive, paving the way for more accretive third-party transactions.

Negative Factors

Capital Volatility Concerns

PRU's recent history with capital volatility, including the IMR issue in 2023, is a frequent concern.

Earnings Miss

PRU's 4Q:24 operating EPS of $2.96 was below consensus at $3.23.

Regulatory Impact

Concerns exist around the impact of ESR adoption in Japan and PRU's mixed history with capital deployment.

Prudential Financial Business Overview & Revenue Model

Company Description

Prudential Financial, Inc., together with its subsidiaries, provides insurance, investment management, and other financial products and services in the United States and internationally. It operates through eight segments: PGIM, Retirement, Group Insurance, Individual Annuities, Individual Life, Assurance IQ, International Businesses, and Closed Block. The company offers investment management services and solutions related to public fixed income, public equity, real estate debt and equity, private credit and other alternatives, and multi-asset class strategies to institutional and retail clients, as well as its general account. It also provides a range of retirement investment, and income products and services to retirement plan sponsors in the public, private, and not-for-profit sectors; and group life, long-term and short-term group disability, and group corporate-, bank-, and trust-owned life insurance in the United States, primarily to institutional clients for use in connection with employee and membership benefits plans, as well as sells accidental death and dismemberment, and other supplemental health solutions; and provides plan administration services in connection with its insurance coverages. In addition, the company develops and distributes individual variable and fixed annuity products, principally to the mass affluent and affluent markets; and individual variable, term, and universal life insurance products to the mass middle, mass affluent, and affluent markets in the United States. Further, it provides third-party life, health, Medicare, property and casualty, and term life products to retail shoppers through its digital and independent agent channels. The company offers its products and services to individual and institutional customers through its proprietary and third-party distribution networks. Prudential Financial, Inc. was founded in 1875 and is headquartered in Newark, New Jersey.

How the Company Makes Money

Prudential Financial generates revenue primarily through its insurance and investment products. The company earns money from premiums paid by policyholders for life insurance and annuity products, which provide financial protection and income solutions. In addition, Prudential manages a substantial portfolio of investments, generating income through asset management fees from mutual funds and institutional accounts. The company's global presence allows it to tap into diverse markets, with significant contributions from its international insurance operations. Prudential also benefits from strategic partnerships and joint ventures that enhance its distribution capabilities and expand its product offerings, enabling it to reach a broader customer base and drive revenue growth.

Prudential Financial Financial Statement Overview

Summary

Prudential Financial shows a mixed financial performance. The income statement reflects solid revenue growth, but the balance sheet's negative equity and high leverage are concerning. The cash flow statement is strong, highlighting good cash generation, but potential volatility in cash management could pose risks. The company should focus on addressing equity and leverage issues to enhance financial stability.

Income Statement

Prudential Financial demonstrates moderate revenue growth with a significant increase from 2023 to 2024. However, net profit margins are low, indicating potential cost management issues. The company's EBIT margin remains strong, showcasing operational efficiency, but the absence of EBITDA data for 2024 limits a comprehensive profitability analysis.

Balance Sheet

The balance sheet reflects a concerning negative stockholders' equity in 2024, indicating potential financial instability. The debt-to-equity ratio cannot be directly calculated due to negative equity, but the significant liabilities outweighing assets suggest high leverage. This poses a risk in stability despite past periods of maintaining positive equity.

Cash Flow

The cash flow statement shows a strong operating cash flow, which has improved significantly. The free cash flow remains consistent, and the operating cash flow to net income ratio suggests robust cash generation relative to earnings. However, fluctuations in investing and financing cash flows indicate potential volatility in cash management.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
70.41B	53.98B	54.58B	71.18B	57.09B
	Gross Profit
70.41B	0.00	0.00	0.00	0.00
	EBIT
0.00	41.06B	42.02B	57.58B	43.19B
	EBITDA
0.00	40.99B	42.13B	57.78B	43.64B
	Net Income Common Stockholders
2.73B	2.49B	-1.65B	8.87B	-374.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
8.28B	19.42B	324.97B	391.93B	434.41B
	Total Assets
735.59B	721.12B	689.92B	937.58B	940.72B
	Total Debt
960.00M	20.87B	21.06B	19.62B	20.95B
	Net Debt
-6.85B	1.46B	3.81B	6.73B	7.25B
	Total Liabilities
705.46B	691.34B	672.71B	874.97B	872.51B
	Stockholders Equity
27.87B	27.82B	16.25B	61.88B	67.42B
Cash Flow		Free Cash Flow
8.50B	6.51B	5.16B	10.55B	8.28B
	Operating Cash Flow
8.50B	6.51B	5.16B	9.81B	8.37B
	Investing Cash Flow
-28.59B	-12.12B	-7.64B	-5.34B	-16.21B
	Financing Cash Flow
19.39B	7.74B	4.93B	-3.01B	4.88B

Prudential Financial Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 101.73
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PRU, the sentiment is Negative. The current price of 101.73 is above the 20-day moving average (MA) of 100.54, below the 50-day MA of 106.70, and below the 200-day MA of 114.93, indicating a neutral trend. The MACD of -1.23 indicates Negative momentum. The RSI at 46.38 is Neutral, neither overbought nor oversold. The STOCH value of 75.58 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for PRU.

Prudential Financial Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AFL	79 Outperform	$59.32B	11.28	22.64%	1.92%	1.21%	24.08%
UNM	76 Outperform	$13.69B	9.16	15.41%	2.05%	1.07%	25.54%
GL	76 Outperform	$9.95B	10.01	21.87%	0.78%	6.07%	17.69%
PUK	72 Outperform	$24.89B	11.61	12.82%	2.13%	-14.78%	34.80%
MET	66 Neutral	$51.73B	12.78	15.41%	2.85%	6.10%	225.22%
Sector *	63 Neutral	$12.46B	9.55	8.14%	17103.96%	12.70%	-4.66%
PRU	61 Neutral	$36.40B	13.69	9.79%	5.11%	34.25%	11.22%

Prudential Financial Corporate Events

Prudential Financial Reports Q1 2025 Earnings Results

Prudential Financial reported its first quarter 2025 results, with net income of $707 million, down from $1.138 billion in the same quarter last year. Despite lower net income, the company saw an increase in after-tax adjusted operating income to $1.188 billion, driven by strong sales in global retirement and insurance businesses, and robust investment performance. The company returned $736 million to shareholders through share repurchases and dividends, and aims to continue balancing business growth with shareholder returns. CEO Andy Sullivan emphasized the company’s commitment to executing its strategy to improve financial performance and maintain its position as a leader in investment, insurance, and retirement security.

Spark’s Take on PRU Stock

According to Spark, TipRanks’ AI Analyst, PRU is a Neutral.

Prudential Financial presents a mixed picture with strong cash flow and valuation attractiveness but faces significant challenges in financial stability due to high leverage and negative equity. While technical indicators are bearish, earnings call insights and corporate events suggest strategic growth and solid shareholder returns. The company needs to address underlying financial concerns to improve its overall standing.

To see Spark’s full report on PRU stock, click here.

Prudential Financial Reveals Q1 2025 Financial Results

Prudential Financial disclosed preliminary financial results for the quarter ended March 31, 2025, revealing a resegmentation of its International Businesses segment and an update to internal expense allocations effective January 1, 2025. The PGIM segment reported $1.39 trillion in assets under management, while alternative investment income from the General Account was below expectations. The resegmentation aligns with changes in management structure, and the expense allocation update impacts segment results but not the company’s consolidated results.

Spark’s Take on PRU Stock

According to Spark, TipRanks’ AI Analyst, PRU is a Neutral.

Prudential Financial’s mixed financial performance, marked by strong revenue growth but concerning balance sheet leverage, is the primary factor influencing the score. The technical analysis suggests a bearish trend, while valuation is reasonable with a high dividend yield. Earnings call insights highlight both strategic growth and ongoing challenges.

To see Spark’s full report on PRU stock, click here.

Prudential Financial Board Member Kathleen Murphy Steps Down

On February 28, 2025, Kathleen A. Murphy announced her decision not to seek reelection to Prudential Financial’s Board of Directors at the upcoming annual meeting on May 13, 2025. Her resignation is attributed to other professional commitments and is not due to any disagreements with the company’s operations or policies.

Prudential Financial Announces Leadership Changes in 2025

Douglas A. Scovanner will not seek reelection to Prudential Financial’s Board of Directors at the shareholder meeting on May 13, 2025, after serving for over 11 years, departing for personal reasons without any disagreements with the company. Additionally, Robert Boyle has been appointed as Senior Vice President, Controller, and Principal Accounting Officer effective April 7, 2025, succeeding Robert Axel, with a new compensation package reflecting his elevated role.

Prudential Financial Unveils 2025 Incentive Programs

Prudential Financial has announced its 2025 Annual and Long-Term Incentive Programs for executive officers, applicable to awards in 2025 relating to 2024 performance. These programs form part of the company’s ongoing efforts to align executive compensation with performance goals and long-term strategic objectives, potentially impacting the company’s operational focus and stakeholder interests.

Prudential Financial Reports Robust Growth Amidst Challenges

Prudential Financial reported its 2024 financial results, highlighting a net income of $2.727 billion, up from $2.488 billion in 2023, despite a net loss in the fourth quarter of $57 million. The company experienced strong sales across its retirement and insurance businesses, expanded its distribution channels, and enhanced its product mix. Prudential declared an increased quarterly dividend and announced a $1 billion stock repurchase authorization for 2025, signaling strong shareholder returns and strategic growth efforts. The company continues to position itself as a global leader by focusing on high-growth opportunities and capital efficiency while achieving substantial progress in its business operations.