Shares of Principal Financial Group, Inc. PFG have gained 32.8% in the past year, outperforming its industry, the Finance sector and the Zacks S&P 500 composite’s growth of 2.5%, 6.5% and 18%, respectively.
Principal Financial has outperformed its peers, including Assurant, Inc. AIZ, MGIC Investment Corporation MTG and Radian Group Inc. RDN. Shares of AIZ, MTG and RDN have gained 25%, 3.7% and 1.1%, respectively, in the past year.
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Principal Financial shares are trading well above the 200-day moving average, indicating a bullish trend.
With a market capitalization of $23.5 billion, the average number of shares traded in the last three months was 1.4 million.
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PFG Shares are Affordable
Principal Financial shares are trading at a price-to-book value of 1.93X, lower than the industry average of 2.64X, the Finance sector’s 4.34X and the Zacks S&P 500 Composite’s 7.37X. Its pricing, at a discount to the industry average, gives a better entry point for investors. The stock has a Value Score of A. This style score helps find the most attractive value stocks.
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PFG’s Encouraging Growth Projection
The Zacks Consensus Estimate for Principal Financial’s 2026 earnings per share indicates a year-over-year increase of 16.7%. The consensus estimate for revenues is pegged at $16.36 billion, implying a year-over-year improvement of 1.9%.
The consensus estimate for 2027 earnings per share and revenues indicates an increase of 8.2% and 8.3%, respectively, from the corresponding 2026 estimates.
Target Price Reflects PFG’s Potential Upside
Based on short-term price targets offered by 12 analysts, the Zacks average price target is $111.58 per share. The average indicates a potential 2.6% upside from the last closing price.
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Optimistic Analyst Sentiment on PFG
Over the past 30 days, two of the six analysts covering the stock have raised estimates for 2026, and one analyst has raised estimates for 2027. As a result, the Zacks Consensus Estimate for 2026 and 2027 moved up 0.3% and 0.3%, respectively, in the last 30 days.
PFG’s Key Tailwinds
Principal Financial is positioned to sustain earnings growth through its diversified business model, rising assets under management (AUM), favorable retirement savings trends and disciplined capital allocation. Its focus on retirement solutions, asset management and workplace benefits provides multiple revenue streams, helping offset uneven performance across individual businesses.
Cross-selling opportunities and international operations further strengthen the insurer's earnings base.
Principal Financial's expanding asset base provides opportunities for recurring fee growth. Sustained inflows and investment performance should continue to maximize fee revenues and operating leverage.
Principal Financial is benefiting from demand for workplace savings, retirement income and pension solutions. Roll-ins exceeded $7 billion over the trailing 12 months, reflecting increased retirement asset consolidation. These trends, along with lifetime income offerings and defined contribution investment-only sales of $2.1 billion, support long-term asset accumulation and recurring revenues.
PFG's September 2026 acquisition of Beam Benefits expands its workplace benefits offerings and digital distribution capabilities in the small and mid-sized business market. Portfolio actions, including the planned sale of its Chile annuity business, also reflect a focus on core growth areas.
Final Take on PFG
Overall, diversified earnings, retirement demand, AUM growth and disciplined capital deployment position Principal Financial for continued growth, although asset outflows and market volatility remain key risks.
Coupled with the attractive valuations, solid growth projections and optimistic analyst sentiment, the time appears right for potential investors to bet on this Zacks Rank #2 (Buy) insurer. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Principal Financial also has a VGM Score of B. Stocks with a favorable VGM Score are those with the most attractive value, best growth and most promising momentum compared with peers. Its impressive dividend history, as well as attractive valuations, are other positives. Back-tested results show that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 or 2, offer the best opportunities in the value investing space.
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Principal Financial Group, Inc. (PFG): Free Stock Analysis Report
MGIC Investment Corporation (MTG): Free Stock Analysis Report
Assurant, Inc. (AIZ): Free Stock Analysis Report
Radian Group Inc. (RDN): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).