We publish no single base value for Principal Financial Group. Our valuation methods put it between $78.23 and $463.54 a share. The valuation code's reason: no point fair value: the two anchors behind it compound the same growth rate and differ only in how they end — a perpetuity at the terminal rate against a multiple on the final year — so the midpoint between them measures terminal treatment rather than what the business is worth. The published range is the same reading with the false precision removed: read it as the span the method supports, and treat neither edge as a point estimate.
| Method | Value | vs price | Basis |
|---|---|---|---|
| Discounted cash flow | $463.54 | +310.3% | free cash flow $5.35bn, growth 5.24% for 5 years, then fading to 3% over 5 more, discounted at 9.27%; stress floor $300.76 |
| Exit multiple (P/E) | $78.23 | -30.8% | earnings per share $9.19 valued at 10.77× (the stock's own median P/E) in 5 years, discounted back |
| Sum of the parts | — | — | no sum of the parts: this run holds no segment disclosure for the name |
| Price to sales | — | — | not reached: the cash-flow or earnings methods produced an anchor, so this fallback was not run |
| Tangible book | — | — | used only for lenders, where book value is the business |
| Price to FFO (REITs) | — | — | used only for REITs |
Each working is rebuilt by code from the valuation's own figures and checked against the published value.
The discount rate:
| Risk-free rate | 5.13% (10-year US Treasury yield) |
| Company's own beta | 0.87 (5 years of monthly returns against the S&P 500; standard error 0.17) |
| Peer beta | 0.93 (median of 74 S&P 500 Financials companies) |
| Blend of own and peers | 0.88 (90% own, 10% peers, weighted by how precisely the company's own beta is measured) |
| Adjusted beta | 0.92 (0.67 × 0.88 + 0.33, pulled toward the market's 1.0) |
| Equity risk premium | 4.5% |
| Discount rate = risk-free + adjusted beta × premium | 9.27% |
Free cash flow grows 5.24% a year for 5 years, then fades in equal steps toward 3% over 5 more; each year is discounted by 1 ÷ (1 + rate)^year:
| Year | Growth | Free cash flow | Discount factor | Present value |
|---|---|---|---|---|
| Now | — | $5.35bn | — | — |
| Year 1 | 5.24% | $5.63bn | 0.9152 | $5.15bn |
| Year 2 | 5.24% | $5.93bn | 0.8375 | $4.96bn |
| Year 3 | 5.24% | $6.24bn | 0.7665 | $4.78bn |
| Year 4 | 5.24% | $6.57bn | 0.7014 | $4.61bn |
| Year 5 | 5.24% | $6.91bn | 0.6419 | $4.44bn |
| Year 6 | 4.87% | $7.25bn | 0.5875 | $4.26bn |
| Year 7 | 4.49% | $7.57bn | 0.5376 | $4.07bn |
| Year 8 | 4.12% | $7.88bn | 0.4920 | $3.88bn |
| Year 9 | 3.75% | $8.18bn | 0.4503 | $3.68bn |
| Year 10 | 3.37% | $8.45bn | 0.4121 | $3.48bn |
| Terminal value = year-10 cash flow × (1 + 3%) ÷ (9.27% − 3%) | $138.88bn |
| Terminal value in today's money | $57.23bn |
| Present value of years 1–10 | $43.31bn |
| Total present value | $100.54bn |
| Shares outstanding | 216.90m |
| Value per share = total ÷ shares | $463.54 |
How the DCF value moves with the discount rate and the starting growth (the middle cell is the published value):
| Discount rate | Growth 0.24% | Growth 5.24% | Growth 10.24% |
|---|---|---|---|
| 8.27% | $406.44 | $553.59 | — |
| 9.27% | $343.34 | $463.54 | — |
| 10.27% | $297.52 | $398.35 | — |
The same DCF at each beta, starting growth unchanged:
| Beta | Value | Discount rate | DCF value |
|---|---|---|---|
| Company's own beta | 0.87 | 9.04% | $481.20 |
| Peer beta | 0.93 | 9.32% | $460.16 |
| Adjusted beta (used) | 0.92 | 9.27% | $463.54 |
Earnings per share grow on the same fading path as the DCF:
| Year | Growth | Earnings per share |
|---|---|---|
| Now | — | $9.19 |
| Year 1 | 5.24% | $9.68 |
| Year 2 | 4.57% | $10.12 |
| Year 3 | 4.10% | $10.53 |
| Year 4 | 3.77% | $10.93 |
| Year 5 | 3.54% | $11.32 |
| Earnings per share in year 5 | $11.32 |
| Exit P/E (the stock's own median P/E) | 10.77× |
| Value in 5 years = earnings × P/E | $121.86 |
| Discounted at 9.27% over 5 years: ÷ 1.5578 | $78.23 |
We publish no single base value for Principal Financial Group. Our valuation methods put it between $78.23 and $463.54 a share. The valuation code's reason: no point fair value: the two anchors behind it compound the same growth rate and differ only in how they end — a perpetuity at the terminal rate against a multiple on the final year — so the midpoint between them measures terminal treatment rather than what the business is worth. The published range is the same reading with the false precision removed: read it as the span the method supports, and treat neither edge as a point estimate.
One-year price simulation: a 10% chance the price is below $85.27 and a 10% chance it is above $167.47 in a year; a 59% chance it is higher than today's $112.97, from 26.2% volatility. The simulation assumes the price drifts up at our discount rate of 9.27% a year.
At $112.97 the price implies free cash flow growing -18.3% a year for five years and then fading toward 3% over five more; its revenue has grown 5.2%.
| Week | Price | Base value |
|---|---|---|
| 2 Oct 2026 | $111.96 | — |
| 9 Oct 2026 | $107.24 | — |
| 16 Oct 2026 | $108.81 | — |
| 23 Oct 2026 | $108.57 | — |
| 30 Oct 2026 | $111.63 | — |
| 6 Nov 2026 | $110.91 | — |
| 12 Nov 2026 | $112.97 | — |
Data as of 12 Nov 2026; financials to 30 Sep 2026. Sources: company filings via EODHD, SEC EDGAR, US Treasury. How these values are computed. Not investment advice.
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