Principal Financial Raises Quarterly Dividend 2.4% to $0.84

Principal Financial Group raised its quarterly dividend 2.4% to $0.84 per share from $0.82. The shares traded ex-dividend on September 3, 2026. The new rate equates to an annual dividend of $3.36 per share.

Why the dividend changed

Principal tied the increase to earnings growth, a strong capital position and its policy of returning excess capital to shareholders. Management said the higher payment demonstrated its continuing commitment to its targeted dividend payout policy.

The declaration accompanied a solid second-quarter report. Non-GAAP operating earnings excluding significant variances rose 13% to $529 million, while the corresponding per-share result increased 17% to $2.42. Principal ended the quarter with $1.6 billion of excess and available capital and returned $427 million to shareholders through dividends and share repurchases. Total assets under management reached $808 billion, although asset-management net cash flow was negative $11.1 billion.

Chief Executive Deanna Strable attributed the results to growth across the company, including its retirement, small and midsized business and global asset-management operations. She described the quarter as one of stronger earnings, improved return on equity and “disciplined capital return.” That combination provides the operating context for another dividend increase.

Principal also completed its acquisition of Beam Benefits after the dividend declaration. Beam adds more than 25,000 small-business customers and digital enrollment and underwriting capabilities to Principal’s Benefits and Protection operation. The company said its 2026 capital-deployment and earnings-growth targets remained unchanged after the transaction, indicating that the acquisition did not displace the existing shareholder-return plan.

Dividend track record

The latest increase extends Principal’s dividend-growth streak to 13 consecutive years. No annual cut appears in the reported history. The pattern has been one of frequent, measured increases rather than a single large annual reset.

Recent payments show that progression. The quarterly amount rose from $0.73 for the December 2, 2024, ex-dividend date to $0.75, $0.76 and $0.78 during 2025. It then advanced to $0.79 for the December 3, 2025, ex-dividend date, followed by $0.80, $0.82 and $0.84 during 2026.

Full-year totals also show continued growth. Annual dividends increased from $2.24 in 2020 to $2.44 in 2021, $2.56 in 2022 and $2.60 in 2023. Growth accelerated in the following two years: the annual total rose 9.6% to $2.85 in 2024 and 8.1% to $3.08 in 2025. The five-year record amounts to 6.6% annual growth.

Is the dividend covered?

The dividend consumes 45% of earnings. That level indicates that less than half of reported profit is being distributed, leaving a meaningful portion available for operations, acquisitions, balance-sheet needs and share repurchases.

SmarterDividends rates the dividend A, with a safety score of 87. That falls within the very safe range of 80-100. The assessment reflects the earnings coverage, the 13-year growth record and Principal’s available capital. It does not eliminate exposure to weaker markets, investment flows or insurance results, but it indicates that the current payment has a substantial coverage cushion.

Yield and valuation

At a share price of $113.96, Principal’s forward dividend yield is 2.95%. That is well below the Financial Services sector median forward yield of 5.70%. The lower relative yield means the shares produce less current dividend income than the sector midpoint, even after the latest increase.

The stock has recorded a 40.0% gain over the past year, a move that weighs on the yield because dividend yield falls as the share price rises. Principal has a market value of $24.4 billion.

SmarterDividends’ fair-value estimate is $114.53. The valuation verdict is fair, with 3% downside. The estimate places the shares near assessed fair value rather than at a wide valuation discount based on the supplied price and valuation measures.

What to watch

The next quarterly results will provide the first full update after the Beam Benefits acquisition. Investors can monitor whether the integration changes expenses, premium growth or capital deployment, particularly because Principal said its 2026 targets were unchanged when the transaction closed.

Asset flows are another relevant measure. Principal’s $808 billion of assets under management supported fee-based earnings, but the negative $11.1 billion of second-quarter net cash flow shows that headline asset growth did not translate into positive organic flows. Market performance and retirement-plan transfers can affect that figure from quarter to quarter.

The next dividend declaration will establish the next ex-dividend and payment dates and show whether Principal continues its recent pattern of incremental quarterly increases. At the current $3.36 annual rate, 100 shares produce $336.00 in annual dividend income before taxes.