Principal Financial Group Prepares for Q4 Earnings Report Amid Market Challenges
Overview of Upcoming Earnings and Analyst Expectations
Principal Financial Group, Inc. (PFG), based in Des Moines, Iowa, stands out as a prominent player in the global financial services sector. Offering a range of solutions such as retirement planning, insurance, and asset management, the company has a market capitalization of $18.3 billion. It is scheduled to announce its Q4 earnings after the market closes on Thursday, February 6.
Profit Projections and Recent Performance
Analysts are anticipating that the financial services firm will report earnings of $1.98 per share for the quarter, reflecting an 8.2% increase from last year’s $1.83 per share. However, Principal Financial has faced challenges recently, failing to meet consensus estimates in three of the last four quarters, with only one positive surprise. In Q3, the company missed earnings expectations by 12.4%, attributed to lower investment management revenues and increased expenses.
Fiscal 2024 Outlook
Looking ahead to fiscal 2024, analysts project an adjusted earnings per share (EPS) of $7.01, a 7% rise from the $6.55 reported in fiscal 2023.
Stock Performance Comparison
Over the past 52 weeks, shares of Principal Financial have increased by just 1.7%. In comparison, the S&P 500 Index ($SPX) has gained 24.4%, while the iShares U.S. Financials ETF (IYF) has surged 34.2% during the same timeframe.
Investor Sentiment and Analyst Ratings
Following its Q3 earnings announcement on October 24, Principal Financial’s stock saw a drop of 6.6%, primarily due to an adjusted EPS of $1.76 and adjusted revenue of $3.7 billion that fell short of expectations. The total expenses rose by 10.4% year-on-year, straining profit margins amid rising assets under management (AUM) and segment revenues. Notably, key segments like Benefits and Protection, as well as Life Insurance, reported significant declines in pre-tax earnings, contributing to negative investor sentiment.
The consensus rating for Principal Financial’s stock remains cautious, classified as a “Hold.” Among 15 analysts following the company, three suggest a “Strong Buy,” eight recommend a “Hold,” and four advocate a “Strong Sell.” Currently, shares of Principal Financial are trading below the average analyst price target of $86.
On the date of publication, Rashmi Kumari did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information, please view the Barchart Disclosure Policy here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
