Key Stats for Prudential Financial Stock
- Price Change: -4.1%
- Current Price: $107
- Wall Street Consensus Target: $120
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What Happened?
Shares of Prudential Financial, Inc. (PRU) dropped 4.1% to close at $107 on Tuesday as investors reacted to a combination of an earnings miss and regulatory news from overseas.
The company reported Q4 2025 adjusted EPS of $3.30, which fell slightly below the analyst consensus of $3.36.
The primary catalyst for the sell-off was the voluntary 90-day suspension of new sales at Prudential of Japan following internal findings of employee misconduct.
Additionally, management expects the Japan unit issue to reduce 2026 pretax adjusted operating income by approximately $300 million to $350 million.
Despite these headwinds, analysts at JPMorgan recently reiterated an Overweight rating while adjusting their target to $127.
Furthermore, Wells Fargo maintained an Equal Weight rating with a $120 target, citing robust performance in alternative investments.
Sector peers like MetLife (NYSE:MET) and AFLAC (NYSE:AFL) are also navigating the shifting interest rate environment and global regulatory landscapes.
See analysts’ growth forecasts and price targets for Prudential Financial stock (It’s free!) >>>
Is Prudential Financial Undervalued Today?
On the latest conference call, CEO Andy Sullivan emphasized that the company is taking decisive action to address the Japan unit issues while focusing on its core growth drivers.
He stated: “We are committed to restoring the standing that has long set us apart in that market… core U.S. businesses benefited from higher spread income and improved underwriting.”
Regarding the capital return program, management highlighted that 2025 was a record year for returning value to shareholders.
Furthermore, he noted: “The company delivered nearly $3 billion to shareholders through dividends and buybacks in 2025… and declared an 18th consecutive year of dividend increases.”
Additionally, management remains confident that the long-term growth trajectory in retirement strategies and global credit management remains intact for 2026.
Read the full Prudential Financial Transcript on TIKR to see the 2026 Japan recovery plan >>>
According to Wall Street consensus data, the current market price of $107 represents a tactical buying opportunity as the market overestimates the impact of the temporary sales pause.
- Target Price: $120
- Current Price: $107
- Potential Upside: +12.1%
Valuation Model Deep Dive
The investment case for Prudential Financial rests on its dominant position in the U.S. retirement market and its rapidly expanding PGIM asset management division.
Consensus targets suggest that the firm is trading at a significant discount to its historical book value multiple.
- The Fair Value Gap: At $107, the stock is trading well below its $120 consensus target, offering a compelling 12.1% recovery potential over the next 12 months.
- The Growth Reality: Analysts expect revenue to grow by 11.6% year-over-year, supported by higher variable life sales and institutional retirement strategy growth.
- The Profitability Check: The company maintains a healthy 15.0% adjusted operating return on equity, up nearly 200 basis points from the prior year.
If Prudential Financial successfully completes its Japan remediation and continues its $1.0 billion share buyback as discussed, the gap to $120 could close significantly by mid-2026.
Conclusion: The insurance giant is positioned for a high-quality 2026 recovery. With a 12.1% upside potential and a path to $120, Prudential Financial stock offers a resilient mix of 5.0% dividend yields and strong retirement market dominance through 2026.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
