Why Principal Financial Group Stock Is Back on Investor Radars

Principal Financial Group (PFG) has drawn fresh attention after reporting second quarter 2026 results that showed higher revenue, broadly steady net income, and slightly higher earnings per share compared with a year earlier.

Principal Financial Group’s share price has gained 3.9% over the past month and 28.9% year to date, while the 1 year total shareholder return of 56.9% points to strong recent momentum supported by the buyback completion and higher dividend.

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Principal Financial Group now combines steady earnings, a completed buyback and a higher dividend with a strong recent share price run. The real test is whether that quality is already fully reflected in today’s valuation.

Most Popular Narrative: 8% Undervalued

The most followed narrative on Principal Financial Group puts its fair value at $125 per share compared with the last close of $115.22. That view rests on a detailed set of assumptions around revenue, earnings and profitability over the next several years.

Principal Financial Group is poised to benefit from accelerating demand for retirement solutions and asset accumulation driven by an aging global population and rising longevity, which should underpin steady growth in recurring deposits, fee revenue, and stable earnings over the long term.

Expansion into international markets and emerging economies, where the growing middle class is fueling heightened demand for retirement, insurance, and wealth management products, positions Principal for above-average asset and revenue growth, especially as local flows in regions like Mexico and Southeast Asia remain strong.

Curious what sits behind that $125 fair value for Principal Financial Group? The narrative leans heavily on compounding fee income, rising margins and a future earnings profile that assumes the current business mix continues to shift toward higher returning segments. The full set of revenue and profit assumptions is what really tells the story.

Result: Fair Value of $125 (UNDERVALUED)

However, you also need to factor in risks to this Principal Financial Group story, including fee pressure in core businesses and higher costs from regulation and competition.

Another View on Principal Financial Group’s Valuation

The first narrative leans on a detailed fair value of $125 per share. A different lens uses Principal Financial Group’s current P/E of 15.8x compared with a fair ratio of 14.5x, the US Insurance industry at 12x, and peers at 15.7x. That points to a richer price tag and raises the question of how much optimism is already built in.

For a closer look at what the numbers imply for today’s price, and how they compare with similar companies, check out the See what the numbers say about this price — find out in our valuation breakdown.

Next Steps

With both optimism and concern running through the Principal Financial Group story, now is a good time to look at the data yourself and decide where you stand. To help weigh both sides of the debate, review the 4 key rewards and 1 important warning sign

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.