Principal Financial Group (PFG) Downgraded by Zacks Investment Research

Zacks Investment Research lowered shares of Principal Financial Group (NYSE:PFG) from a hold rating to a sell rating in a report released on Wednesday morning.

According to Zacks, “Shares of Principal Financial have underperformed the industry in a year's time. The stock also witnessed its 2018 and 2019 estimates moving down in the last 60 days. Higher leverage inducing increase in interest weighing on margin expansion remains a headwind. Nonetheless, focus on fee-based revenue sources has been helping Principal Financial earn steadily and limiting its exposure to the interest rate environment. The company targets a return on equity improvement of 30-60 basis points annually, and a long-term earnings growth rate between 9% and 12%. Its inorganic growth story remains impressive with buyouts fortifying the international footprint. Its assets under management have also been steadily rising. Plus, it sets sights on effective capital deployment to enhance the shareholder value, which is targeted to reach $0.9-$1.3-billion mark in 2018.”

Several other research firms also recently weighed in on PFG. Credit Suisse Group started coverage on shares of Principal Financial Group in a research note on Wednesday, April 25th. They issued a neutral rating and a $62.00 target price for the company. Wells Fargo & Co reiterated a hold rating and issued a $68.00 target price on shares of Principal Financial Group in a research note on Thursday, April 26th. Morgan Stanley reduced their target price on shares of Principal Financial Group from $79.00 to $77.00 and set an equal weight rating for the company in a research note on Thursday, April 5th. Bank of America started coverage on shares of Principal Financial Group in a research note on Monday, March 26th. They issued a neutral rating and a $65.00 target price for the company. Finally, UBS Group started coverage on shares of Principal Financial Group in a research note on Friday, March 2nd. They issued a neutral rating and a $69.00 target price for the company. Two analysts have rated the stock with a sell rating, seven have issued a hold rating and three have given a buy rating to the stock. The company currently has an average rating of Hold and an average target price of $71.00.

Shares of PFG stock opened at $52.95 on Wednesday. The company has a debt-to-equity ratio of 0.26, a quick ratio of 0.10 and a current ratio of 0.10. Principal Financial Group has a 52 week low of $52.31 and a 52 week high of $75.58.

Principal Financial Group (NYSE:PFG) last announced its quarterly earnings data on Thursday, April 26th. The financial services provider reported $1.40 EPS for the quarter, topping the consensus estimate of $1.35 by $0.05. The business had revenue of $2.91 billion for the quarter, compared to analyst estimates of $3.54 billion. Principal Financial Group had a net margin of 12.35% and a return on equity of 13.55%. During the same quarter in the previous year, the firm posted $1.27 earnings per share. equities analysts anticipate that Principal Financial Group will post 5.22 earnings per share for the current fiscal year.

The company also recently disclosed a quarterly dividend, which was paid on Friday, June 29th. Investors of record on Monday, June 4th were paid a dividend of $0.52 per share. The ex-dividend date of this dividend was Friday, June 1st. This represents a $2.08 annualized dividend and a yield of 3.93%. This is a boost from Principal Financial Group’s previous quarterly dividend of $0.51.

Principal Financial Group declared that its Board of Directors has approved a stock repurchase plan on Monday, May 7th that permits the company to buyback $300.00 million in shares. This buyback authorization permits the financial services provider to reacquire up to 1.7% of its shares through open market purchases. Shares buyback plans are usually an indication that the company’s management believes its shares are undervalued.

In related news, insider James P. Mccaughan sold 20,000 shares of the business’s stock in a transaction that occurred on Monday, June 4th. The shares were sold at an average price of $56.31, for a total transaction of $1,126,200.00. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through this link. 1.50% of the stock is currently owned by insiders.

A number of large investors have recently modified their holdings of the stock. Cornercap Investment Counsel Inc. grew its stake in Principal Financial Group by 2.0% during the first quarter. Cornercap Investment Counsel Inc. now owns 58,460 shares of the financial services provider’s stock valued at $3,561,000 after acquiring an additional 1,135 shares in the last quarter. Asset Management One Co. Ltd. grew its stake in Principal Financial Group by 0.3% in the 1st quarter. Asset Management One Co. Ltd. now owns 442,209 shares of the financial services provider’s stock worth $26,935,000 after buying an additional 1,140 shares in the last quarter. WINTON GROUP Ltd grew its stake in Principal Financial Group by 15.8% in the 1st quarter. WINTON GROUP Ltd now owns 8,377 shares of the financial services provider’s stock worth $510,000 after buying an additional 1,141 shares in the last quarter. Advisor Group Inc. grew its stake in Principal Financial Group by 2.6% in the 4th quarter. Advisor Group Inc. now owns 45,893 shares of the financial services provider’s stock worth $3,239,000 after buying an additional 1,155 shares in the last quarter. Finally, Archford Capital Strategies LLC grew its stake in Principal Financial Group by 7.7% in the 1st quarter. Archford Capital Strategies LLC now owns 18,298 shares of the financial services provider’s stock worth $1,291,000 after buying an additional 1,305 shares in the last quarter. 68.64% of the stock is owned by institutional investors.

About Principal Financial Group

Principal Financial Group, Inc provides retirement, asset management, and insurance products and services to businesses, individuals, and institutional clients worldwide. It operates through Retirement and Income Solutions, Principal Global Investors, Principal International, and U.S. Insurance Solutions segments.

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