Principal Financial Group (PFG): 3Q26 First Take: Earnings Pressured by Lower Variable Investment Income, Flows Poor Overall

J.P. Morgan's 3Q26 first take on Principal Financial Group (PFG.US) keeps a Neutral rating with the stock at $110.13. 3Q26 adjusted EPS of $2.22 came in ~10% below JPM's $2.47 estimate and ~9% below the $2.44 consensus. Normalizing for weaker variable investment income (-$0.15) and Beam integration costs (-$0.04), partly offset by a smaller negative encaje impact (+$0.02), adjusted EPS would have been $2.39. Retirement and Income Solutions posted pretax income of $298 million versus the $342 million estimate on a 39.0% margin (vs. 42.6% expected), driven by lower net revenues and a fee income shortfall; Investment Management operating income was $168.1 million, slightly below expectations, with a base fee rate of 27.8 bps; International Pension beat at $62.4 million;