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Is Principal Financial (PFG) Likely to Beat on Q2 Earnings?

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Principal Financial Group, Inc. (PFG - Free Report) is slated to report second-quarter 2021 results on Jul 27, after market close. The company delivered an earnings surprise of 13.33% in the last reported quarter.

Factors at Play

Principal Financial second-quarter results are likely to reflect benefits from leadership in retirement and long-term savings, group benefits and protection in the United States, retirement and long-term savings in Latin America and Asia plus global asset management.

Given the low interest rate environment, the company estimates lower sales in pension risk transfer.

Premiums at Retirement and Income Solutions segment is likely to have been weighed down by lower sales of single premium individual and group annuities with life contingencies.

Investment income is expected to have benefited from favorable investment performance at Latin America business and favorable U.S. market performance on certain alternative investments.

The Zacks Consensus Estimate for second-quarter 2021 revenues is pegged at $3.7 billion, indicating an increase of 16.3% from the year-ago quarter reported figure.

Assets under management is likely to have benefited from extensive distribution footprint, best-in-class solutions, favorable market performance and the migration of some of the Institutional Retirement & Trust (IRT) retirement business. This is likely to have aided revenue improvement at Principal Global Investors.

Expenses are likely to have decreased due to lower operating expenses and benefits, claims and settlement expenses.

Continued share buybacks are likely to have provided additional upside to the bottom line.

The Zacks Consensus Estimate for second-quarter 2021 earnings stands at $1.53 per share, indicating an increase of 4.8% from the year-ago reported figure.

What Our Quantitative Model Predicts

Our proven model predicts a likely earnings beat for Principal Financial this time around. This is because it has the right combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold).

Earnings ESP: Principal Financial has an Earnings ESP of +0.05%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Principal Financial currently carries a Zacks Rank #3.  

Other Stocks to Consider

Some stocks from the finance sector also with the right combination of elements to surpass estimates this time around are as follows:

Ameriprise Financial (AMP - Free Report) has an Earnings ESP of +1.31% and a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Ares Management (ARES - Free Report) has an Earnings ESP of +2.82% and a Zacks Rank #3.

Federated Hermes (FHI - Free Report) has an Earnings ESP of +1.52% and a Zacks Rank of 3.