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Principal Financial (PFG) on Growth Track: Time to Invest?
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Shares of Principal Financial Group, Inc. (PFG - Free Report) gained 59.97% in the last one year, significantly outperforming the Zacks categorized Investment Management industry’s increase of 10.09%. Also, the company saw its 2017 estimates moving north by nearly 0.8% over the last 60 days. We expect the stock to retain its momentum on the back of a number of positives.
Principal Financial has been operating earnings growth over a considerable period of time. This is primarily owing to the better-than-expected performance across most of its lines and segments. Going ahead, the company is expected to deliver strong investment performance, expand its solution set and strengthen relationships with customers and distributors.
Moreover, the company’s improving Asset Under Management (AUM), strong sales and client retention have poised it well for solid earnings growth in 2017. Over the next five years, premium and fee growth at Individual Life is expected at 4–8%, while Specialty Benefits is estimated witness an increase of 8–10%.
The investment manager has also projected revenue growth for its Retirement and Investor Services, Principal International and Principal Global Investors businesses in 2017.
Principal Financial’s AUM has been steadily increasing over the last few years. The improvement can be attributed to better results at three asset management and asset accumulation segments. Also, the AUM growth is supported by the company’s extensive distribution network, best-in-class solutions and operational discipline. Principal Financial expects AUM to reach $1 trillion within five to seven years on the back of various growth drivers and its strong market position.
Principal Financial has been deploying capital effectively to enhance shareholders’ value. The company expects capital deployment between $800 million and $1 billion in 2017 (in quarterly dividends, strategic acquisitions and share buybacks). Over the long term, Principal Financial is likely to spend 65–70% of the net income on such activities.
Also, the Zacks Rank #2 (Buy) investment manager has a trailing 12-month return on equity (ROE) of 12.7%, which is marginally higher than the industry average of 12.6%. Furthermore, the company’s expected long-term earnings growth is pegged at 8.70%.
Ameriprise Financial offers various financial products and services to individual and institutional clients in the United States and internationally. The company delivered a positive surprise in one of the last four quarters with an average beat of 1.06%.
Apollo Global is a publicly owned investment manager. The company delivered positive surprises in three of the last four quarters with an average beat of 58.06%.
Lazard Ltd. operates as a financial advisory and asset management firm worldwide. The company delivered positive surprises in three of the last four quarters with an average beat of 0.03%.
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Principal Financial (PFG) on Growth Track: Time to Invest?
Shares of Principal Financial Group, Inc. (PFG - Free Report) gained 59.97% in the last one year, significantly outperforming the Zacks categorized Investment Management industry’s increase of 10.09%. Also, the company saw its 2017 estimates moving north by nearly 0.8% over the last 60 days. We expect the stock to retain its momentum on the back of a number of positives.
Principal Financial has been operating earnings growth over a considerable period of time. This is primarily owing to the better-than-expected performance across most of its lines and segments. Going ahead, the company is expected to deliver strong investment performance, expand its solution set and strengthen relationships with customers and distributors.
Moreover, the company’s improving Asset Under Management (AUM), strong sales and client retention have poised it well for solid earnings growth in 2017. Over the next five years, premium and fee growth at Individual Life is expected at 4–8%, while Specialty Benefits is estimated witness an increase of 8–10%.
The investment manager has also projected revenue growth for its Retirement and Investor Services, Principal International and Principal Global Investors businesses in 2017.
Principal Financial’s AUM has been steadily increasing over the last few years. The improvement can be attributed to better results at three asset management and asset accumulation segments. Also, the AUM growth is supported by the company’s extensive distribution network, best-in-class solutions and operational discipline. Principal Financial expects AUM to reach $1 trillion within five to seven years on the back of various growth drivers and its strong market position.
Principal Financial has been deploying capital effectively to enhance shareholders’ value. The company expects capital deployment between $800 million and $1 billion in 2017 (in quarterly dividends, strategic acquisitions and share buybacks). Over the long term, Principal Financial is likely to spend 65–70% of the net income on such activities.
Also, the Zacks Rank #2 (Buy) investment manager has a trailing 12-month return on equity (ROE) of 12.7%, which is marginally higher than the industry average of 12.6%. Furthermore, the company’s expected long-term earnings growth is pegged at 8.70%.
Stocks to Consider
Investors interested in other stocks from the same space can consider Ameriprise Financial, Inc. (AMP - Free Report) , Apollo Global Management, LLC (APO - Free Report) and Lazard Ltd. (LAZ - Free Report) . Each of the stocks holds a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Ameriprise Financial offers various financial products and services to individual and institutional clients in the United States and internationally. The company delivered a positive surprise in one of the last four quarters with an average beat of 1.06%.
Apollo Global is a publicly owned investment manager. The company delivered positive surprises in three of the last four quarters with an average beat of 58.06%.
Lazard Ltd. operates as a financial advisory and asset management firm worldwide. The company delivered positive surprises in three of the last four quarters with an average beat of 0.03%.
Zacks’ Best Private Investment Ideas
In addition to the recommendations that are available to the public on our website, how would you like to follow all Zacks' private buys and sells in real time?
Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors. Starting today, for the next month, you can have unrestricted access. Click here for Zacks' private trades >>