On Aug 19, 2014, shares of
Principal Financial Group Inc
) scaled a 52-week high of $52.57 buoyed by a solid second-quarter
earnings beat. With about 1.14 billion shares exchanging hands in
the last trading session, shares closed at $52.24, gaining 0.5%.
The year-to-date return from the stock came in at 22.9%, which was
ahead of the S&P's return of 19.7%. With respect to earnings
performance, this investment manager has delivered positive
surprises in all the last four quarters with an average beat of
In the second quarter, Principal Financial posted earnings of $1.08
per share that surpassed the Zacks Consensus Estimate by about 7%
and improved nearly 19% year over year. Increased focus on
fee-based businesses along with improved investment income drove
the top line higher, and more than offset the increase in expenses
thereby aiding solid earnings at the company. Its assets under
management in the quarter were a record $517.9 billion as of Jun
30, 2014, up 15% year over year.
Backed by healthy earnings and a noble intention to share more
profits with shareholders, Principal Financial increased its
dividend by 6%. The company also regularly engages in share
repurchases that in turn aid the bottom line. Principal Financial
expects capital deployment in 2014 to be at or above the top end of
the $500 - $700 million guidance range.
Riding on thesepositives, this Zacks Rank #2 (Buy) stock has been
witnessing upward revisions in the Zacks Consensus Estimate in the
last 30 days. For 2014, the Zacks Consensus Estimate for earnings
moved north by 2.9% to $4.25 per share as 10 of 13 estimates were
raised while for 2015, it scaled 2.0% to $4.49 as 8 of 13 estimates
moved up. The expected long-term earnings growth is 11.7%.
Other Stocks to Consider
Principal Financial carries a Zacks Rank #2 (Buy). Investors
interested in investment managers may also consider Ameriprise
Financial, Inc. (
), The Blackstone Group L.P. (
), Invesco Ltd. (
). All these stocks hold the same Zacks Rank as Principal
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