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Sat, February 14, 2026 astatine 3:04 PM CST 8 min read
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Principal raised its ROE people to 15%–17% (from 14%–16%) and reiterated a 2026 outlook of 9%–12% EPS growth and 75%–85% escaped currency flow aft reporting 2025 adjusted EPS maturation of 12% and a 120 bp ROE increase.
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SMB remains a halfway maturation precedence — Principal says SMB clients are long-tenured and resilient, with interior probe showing 95% expect stable/increasing salaries and ~85% expect stable/increasing employment, portion the steadfast focuses connected bundling status and benefits wrong that segment.
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Principal is scaling AI broadly (from nether 1,000 to ~17,000 employees, ~7,000 regular users) to thrust productivity and borderline gains contempt upfront costs, and its plus absorption concern generated astir $3.5–4 billion of affirmative flows successful privates during 2025.
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Principal Financial Group (NASDAQ:PFG) President and CEO Deanna Strable utilized an quality astatine Bank of America’s U.S. Financial Services Conference to reenforce the company’s presumption that it is carrying beardown momentum retired of 2025 and into 2026, portion highlighting strategical priorities successful tiny and midsize concern (SMB) status and benefits, planetary plus management, and exertion investments tied to artificial intelligence.
Strable said Principal’s 2025 show followed “a truly beardown 2024,” with adjusted EPS maturation of 12% for the year, which she described arsenic the apical extremity of the company’s targeted range. On a reported basis, she said results were “nearly 20%.” She added that escaped currency travel came successful astatine the apical extremity oregon supra the apical extremity of Principal’s targeted range, and instrumentality connected equity accrued 120 ground points, landing successful the “top half” of its targeted range.
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Looking ahead, Strable characterized the 2026 outlook arsenic accordant with caller delivery. Principal is inactive targeting 9% to 12% EPS maturation and 75% to 85% escaped currency flow. She besides noted the institution raised its ROE people to 15% to 17% from 14% to 16%, saying the alteration reflects some existent positioning and assurance successful continued trajectory.
Strable emphasized that SMB has been a halfway U.S. absorption for decades and remains 1 of Principal’s cardinal maturation priorities alongside the status ecosystem and planetary plus management. She defined SMB arsenic employers with up to 1,000 employees and said Principal’s status concern spans that range, skewing much toward the “M” side, portion besides participating successful the large-case market. In worker benefits, she said the institution is concentrated successful SMB and tends to skew toward smaller employers, wherever it has seen “outsized growth.”
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