Yahoo Finance What's in Store for Principal Financial (PFG) in Q1 Earnings?
Principal Financial Group, Inc. PFG is slated to report first-quarter 2023 earnings on Apr 27, after market close. PFG delivered an earnings surprise in each of the last four quarters, the average being 13.76%.
Factors at Play
Principal Financial’s first-quarter results are likely to reflect growth in the Specialty Benefits insurance business, increase in Individual Life insurance premiums, higher net yields and higher inflation-based investment returns on average invested assets and cash.
Revenues in the Retirement and Income Solutions segment are likely to have decreased due to declining financial markets and fall in variable investment income, reduction associated with the impacts of exited retail fixed annuity business along with drop in variable investment income. The downside is likely to have been partially offset by higher net yields and positive impact associated with actuarial assumption updates and model refinements.
Investment income is likely to have been affected by impacts of the Reinsurance Transaction in 2022. The downside is likely to have been partially offset by higher inflation-based investment returns on Latin America average invested assets and cash. The Zacks Consensus Estimate for net investment income is pegged at $982 million, suggesting a decline of 12.2% from the year-ago reported figure. We expect net investment income to be $956.6 million.
Growth in the Specialty Benefits insurance business and increase in Individual Life insurance premiums related to the retrocession of ceded premiums as a result of the Reinsurance Transaction are likely to have benefited revenue growth in the to-be-reported quarter.
The Zacks Consensus Estimate for first-quarter 2023 revenues is pegged at $3.2 billion, indicating a decline of 0.9% from the year-ago quarter’s reported figure. We expect total revenues to be $2.3 billion.
Assets under management is likely to have benefited from favorable market performance, higher net customer cash flow and positive market returns.
Expenses are likely to have decreased due to lower operating expenses and benefits, claims and settlement expenses. We expect total expenses to be $2.6 billion.
Operating expenses are likely to have decreased due to lower incentive compensation costs and decrease in amounts credited to employee accounts in a nonqualified defined contribution pension plan. We expect operating expenses to be $1.2 billion.
The Zacks Consensus Estimate for first-quarter 2023 earnings is pegged at $1.54 per share, indicating a decline of 5.52% from the year-ago reported figure. We expect the bottom line to be $1.5 per share for the to-be-reported quarter.
What Our Quantitative Model Predicts
Our proven model does not conclusively predict an earnings beat for Principal Financial this time around. This is because the stock needs to have the right combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for an earnings beat. This is not the case as you can see below.
Earnings ESP: Principal Financial has an Earnings ESP of -0.16%. This is because the Most Accurate Estimate is pegged at $1.53, higher than the Zacks Consensus Estimate of $1.54. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Principal Financial Group, Inc. Price and EPS Surprise
Principal Financial Group, Inc. price-eps-surprise | Principal Financial Group, Inc. Quote
Zacks Rank: Principal Financial currently carries a Zacks Rank #3.
Stocks to Consider
Some stocks from the finance sector with the right combination of elements to surpass estimates this time around are as follows:
BlackRock, Inc. BLK has an Earnings ESP of +1.84% and a Zacks Rank of 3. The Zacks Consensus Estimate for BlackRock’s first-quarter 2023 earnings is pegged at $8.46 per share, indicating an increase of 14.9% from the year-ago reported figure. You can see the complete list of today’s Zacks #1 Rank stocks here.
BLK’s earnings beat estimates in three of the last four quarters and missed in the other one.
AssetMark Financial Holdings, Inc. AMK has an Earnings ESP of +1.87% and a Zacks Rank of 2. The Zacks Consensus Estimate for AssetMark Financial’s first-quarter 2023 earnings is pegged at 54 cents per share, indicating an increase of 38.5% from the year-ago reported figure.
AMK’s earnings beat estimates in each of the four trailing quarters.
Ares Management Corporation ARES has an Earnings ESP of +2.30% and a Zacks Rank of 3. The Zacks Consensus Estimate for Ares Management’s first-quarter 2023 earnings is pegged at 83 cents per share, indicating an increase of 27.6% from the year-ago reported figure.
ARES’ earnings beat estimates in three of the last four quarters and missed in the other one.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
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BlackRock, Inc. (BLK) : Free Stock Analysis Report
Principal Financial Group, Inc. (PFG) : Free Stock Analysis Report
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AssetMark Financial Holdings, Inc. (AMK) : Free Stock Analysis Report
