Fidelity National Financial (NYSE:FNF) versus Principal Financial Group (NASDAQ:PFG) Financial Survey

Fidelity National Financial (NYSE:FNF) and Principal Financial Group (NASDAQ:PFG) are both large-cap finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, dividends, analyst recommendations, earnings, risk, profitability and valuation.

Risk & Volatility

Fidelity National Financial has a beta of 1.01, meaning that its share price is 1% more volatile than the S&P 500. Comparatively, Principal Financial Group has a beta of 0.89, meaning that its share price is 11% less volatile than the S&P 500.

Dividends

Fidelity National Financial pays an annual dividend of $2.00 per share and has a dividend yield of 3.4%. Principal Financial Group pays an annual dividend of $3.16 per share and has a dividend yield of 3.6%. Fidelity National Financial pays out 46.5% of its earnings in the form of a dividend. Principal Financial Group pays out 46.0% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Fidelity National Financial has increased its dividend for 1 consecutive years and Principal Financial Group has increased its dividend for 2 consecutive years. Principal Financial Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Fidelity National Financial and Principal Financial Group, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Fidelity National Financial	0	1	4	0	2.80
Principal Financial Group	0	0	1	0	3.00

Fidelity National Financial presently has a consensus target price of $70.00, indicating a potential upside of 20.43%. Given Fidelity National Financial’s higher possible upside, equities analysts plainly believe Fidelity National Financial is more favorable than Principal Financial Group.

Earnings & Valuation

This table compares Fidelity National Financial and Principal Financial Group”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Fidelity National Financial	$13.68 billion	1.15	$1.27 billion	$4.30	13.52
Principal Financial Group	$16.13 billion	1.21	$1.57 billion	$6.87	12.74

Principal Financial Group has higher revenue and earnings than Fidelity National Financial. Principal Financial Group is trading at a lower price-to-earnings ratio than Fidelity National Financial, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Fidelity National Financial and Principal Financial Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Fidelity National Financial	8.34%	15.06%	1.33%
Principal Financial Group	9.96%	16.02%	0.57%

Institutional & Insider Ownership

81.2% of Fidelity National Financial shares are owned by institutional investors. Comparatively, 75.1% of Principal Financial Group shares are owned by institutional investors. 5.5% of Fidelity National Financial shares are owned by insiders. Comparatively, 1.1% of Principal Financial Group shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Summary

Principal Financial Group beats Fidelity National Financial on 10 of the 17 factors compared between the two stocks.

About Fidelity National Financial

Fidelity National Financial, Inc., together with its subsidiaries, provides various insurance products in the United States. The company operates through Title, F&G, and Corporate and Other segments. It offers title insurance, escrow, and other title related services, including trust activities, trustee sales guarantees, recordings and reconveyances, and home warranty products. The company also provides technology and transaction services to the real estate and mortgage industries; and mortgage transaction services, including title-related services and facilitation of production and management of mortgage loans. In addition, it offers annuity and life insurance products, such as deferred and immediate annuities, as well as indexed universal life insurance products; and funding agreements and pension risk transfer (PRT) solutions. Further, the company engages in the real estate brokerage business. Fidelity National Financial, Inc. was incorporated in 2005 and is headquartered in Jacksonville, Florida.

About Principal Financial Group

Principal Financial Group, Inc. provides retirement, asset management, and insurance products and services to businesses, individuals, and institutional clients worldwide. The company 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 for retirement savings and income. It offers products and services for defined contribution plans, including 401(k) and 403(b) plans, defined benefit pension plans, nonqualified executive benefit plans, employee stock ownership plans, equity compensation, and pension risk transfer services; individual retirement accounts; investment only products; and mutual funds, individual variable annuities, 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 products and services, mutual funds, asset management, income annuities, and life insurance accumulation products, as well as voluntary savings plans in Brazil, Chile, Mexico, China, Hong Kong Special Administrative Region, India, and Southeast Asia. The U.S. Insurance Solutions segment provides specialty benefits, such as group dental and vision insurance, group life insurance, and group and individual disability insurance, as well as administers group dental, disability, and vision benefits; and individual life insurance products comprising universal, variable universal, indexed universal, and term life insurance products in the United States. It also offers 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.