Deutsche Bank Starts Principal Financial Group (PFG) at Hold

January 8, 2013 5:49 PM EST
Get Alerts PFG Hot Sheet
Price: $59.03 +1.30%

Rating Summary:
    7 Buy, 9 Hold, 6 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 11 | Down: 21 | New: 54
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Deutsche Bank initiates coverage on Principal Financial Group (NYSE: PFG) with a Hold. PT $31.00.

The firm comments, "Over the last decade, the company has increasingly shifted its focus to a fee-for-service orientation at the expense of its protection and spread businesses. While Principal continues to offer individual and group life products as well as individual annuities, these are now viewed as ancillary products that round out the company’s retirement services and asset management platform. As a result of its changing business mix and somewhat limited exposure to interest rate risk, we have seen PFG trade above group valuation, despite generating average ROEs." The firm also notes translating AUM growth into EPS growth has proven difficult.

The firm's operating EPS forecast estimates for FY12E-FY14E are $2.62, $3.20 and $3.60, respectively – largely in line with consensus

For an analyst ratings summary and ratings history on Principal Financial Group click here. For more ratings news on Principal Financial Group click here.

Shares of Principal Financial Group closed at $29.07 yesterday.

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