Principal Financial Group, Inc. provides retirement, asset management, and insurance products and services to businesses, individuals, and institutional clients worldwide. It operates through Retirement and Income Solutions, Principal Global Investors, Principal International, and U.S. Insurance Solutions segments. The Retirement and Income Solutions segment provides a portfolio of asset accumulation products and services, including retirement savings and income. It offers products and services for defined contribution pension plans, including 401(k) and 403(b) plans, defined benefit pension plans, nonqualified executive benefit plans, and employee stock ownership plans; individual retirement accounts and payroll deduction plans; investment-only products; and annuities, mutual funds, and bank products. The Principal Global Investors segment provides equity, fixed income, real estate, and other alternative investments, as well as asset allocation, stable value management, and other structured investment strategies. The Principal International segment offers pension accumulation and income annuity products, mutual funds, asset management, and life insurance accumulation products, as well as voluntary savings plans in Brazil, Chile, China, Hong Kong Special Administrative Region, India, Mexico, and Southeast Asia. The U.S. Insurance Solutions segment provides specialty benefits consisting of group dental and vision insurance, individual and group disability insurance, and group life insurance; and individual life insurance products comprising universal and variable universal life insurance, and term life insurance, as well as non-medical fee-for-service claims administration services in the United States. It also provides insurance solutions for small and medium-sized businesses and their owners, as well as executives. Principal Financial Group, Inc. was founded in 1879 and is based in Des Moines, Iowa.
Business Analysis of Principal Financial Group
The Insurance Sector is witnessing a major shakeup, new age business models in the industry are transforming both customers and businesses. Faced with this uncertainity, companies are investing resources to transform their business. An in-depth business analysis is a valuable resource to identify and articulate the need for a business model change. At R&P Research we believe, the starting point for a business analysis is Benchmarking. Business benchmarking can be done at various levels: 1) Industry Benchmarking 2) Peer Benchmarking 3) Disruptors Benchmarking. In this report, we share the snapshot of how Principal Financial Group compares against the industry on the major performance indicators. This analysis, along with peer group/disruptors benchmarking and revenue model understanding can help identify growth and cost optimization opportunities to maximize the value delivered by Principal Financial Group to its stakeholders. R&P Research Industry Intelligence Platform provides historical data for last 15 years with an easy to use benchmarking interface for an in-depth comparative business analysis.
Here is the performance snapshot of Principal Financial Group with an interactive chart.
- Revenue Growth: Principal Financial Group reported a revenue growth of 3.6% year-on-year during 2016. Diversified Insurance Industry grew at 0.6% in the same period
- COGS share of Revenues: As a percentage of revenue, Principal Financial Group spent 57.0% of its total revenues on COGS. Diversified Insurance industry average (COGS share of revenue) in the same period was 54.2%
- R&D share of Revenues: Principal Financial Group R&D share of Revenues details are not available because either company does not share the data or we do not have it
- SG&A share of Revenues: As a percentage of revenue, Principal Financial Group spent 30.1% of its total revenues on Sales, Marketing, and General Administration (SG&A). Diversified Insurance industry average SG&A spending in the same period was 21.6%
- Inventory share of Revenues: Principal Financial Group Inventory share of Revenues details are not available because either company does not share the data or we do not have it
- Accounts Payable share of Revenues: Principal Financial Group Accounts Payable share of Revenues details are not available because either company does not share the data or we do not have it
- Accounts Receivable share of Revenues: As a percentage of revenue, Principal Financial Group invested 11.0% of its total revenues on Accounts Receivable (A/R). Diversified Insurance industry average Accounts Receivable investment in the same period was 37.0%
- PP&E share of Revenues: As a percentage of revenue, Principal Financial Group invested 5.6% of its total revenues on Property, Plants, and Equipments (PP&E). Diversified Insurance industry average PPE investment in the same period was 3.4%
- Intangibles share of Revenues: As a percentage of revenue, Principal Financial Group invested 18.9% of its total revenues on Intangibles. Diversified Insurance industry average Intangibles investment in the same period was 6.9%
- Net Margins: Principal Financial Group Net Margins in the year 2016 were 10.6%. Diversified Insurance industry average Net Margins in the same period were 10.2%
Sector and Industry Association of Principal Financial Group
For the purpose of performance benchmarking of a company with a sector or industry average, R&P Research associates every company with one sector and one industry. An industry consists of companies with related/similar business models. A sector comprises of a group of related/similar industries. For high-level analysis purposes, related/similar sectors are grouped into sector groups.
Principal Financial Group is associated with Financials Sector Group, Insurance Sector, and Diversified Insurance Industry.
Insurance sector is comprised of the following industries: Life Insurance; Property & Casualty Insurance; Surety & Title Insurance; Insurance Brokerage; Diversified Insurance. The definitions for each of the industries is as follows:
- Life Insurance industry includes companies engaged principally in life insurance.
- Property & Casualty Insurance industry includes companies engaged principally in accident, fire, automotive, marine, malpractice and other classes of non-life insurance.
- Surety & Title Insurance industry includes companies providing title & surety insurance.
- Insurance Brokerage industry includes insurance brokers and agencies.
- Diversified Insurance industry includes companies with life, health, property & casualty, and reinsurance interests, none of which predominates.
Industry Ranking of Principal Financial Group
With $12.4 billion revenues, Principal Financial Group ranked number 2 of all the companies in the US Diversified Insurance industry. There were a total of 7 public companies in the US Diversified Insurance industry that had revenues greater than $50 million during 2016.
The top companies in the US Diversified Insurance industry by revenues during 2016 were:
Business Model Analysis (BMA) Framework
We use the following framework to assess the business model of a company. Business Model Analysis framework can be used by organizations to articulate growth strategies and identify cost optimization opportunities. Technology and consulting companies can use this framework to identify the value drivers and pain points of their targeted customers. Entrepreneurs can use this framework to understand the language of business and identify promising business opportunities. This framework can be used by any professional aspiring to take up a leadership role to better understand the businesses challenges, articulate growth strategy, and monitor the business improvement requirements for the organization.
- Conduct a holistic benchmarking; to identify and target additional sources of value
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- Get free data, charts, and analysis of Principal Financial Groupand its peers on select key performance indicators by clicking the reports provided below