Prudential Financial estimates $140M hit to Q3 earnings from Japan (PRU:NYSE)

Keefe Bruyette & Woods cut Prudential Financial's (NYSE:PRU) price target to $119 from $123, citing lower earnings estimates due to Japan sales impact. Prudential reported mixed Q3 results, with alternative investment income beating estimates but PGIM revenues missing forecasts. The company also disclosed a negative $140M impact from POJ sales suspension. Other analysts, including Mizuho and Barclays, also lowered their price targets.

PRUDENTIAL FINANCIAL INC (PFH) filed an SEC Form 8-K — Results of Operations and Financial Condition. Table of Contents Exhibit 99.1 Prudential Financial, Inc. (PRU) As Adjusted for International Businesses Segment Reporting Changes Quarterly Financial Supplement Second Quarter 2026 Reference is made to Prudential Financial, Inc.'s (PFI) filings with the Securities and Exchange C

S&P revised Prudential Financial's outlook to negative due to Japan's regulatory issues, expecting $600M pretax drag in 2026, rising to $675M-$725M in 2027. The agency affirmed its 'A/A-1' ratings but cited risks to holding company liquidity and ROE decline to 8%-10% in 2026, 6%-8% in 2027. Operating units maintain 'AA-' financial strength.

Japan's FSA ordered Prudential's life insurers to halt new business until Jan. 31, 2027, due to a fraud scandal. Prudential of Japan and Gibraltar Life must submit improvement plans. The scandal involved 107 employees defrauding 500 customers. Prudential Financial assures financial stability and parent support.

Mizuho reduced its price target on Prudential Financial (NYSE:PRU) to $108 from $109, citing Japan's Financial Services Agency's sales suspension on Prudential of Japan and Gibraltar Life. The company expects a $1 billion impact, with adjusted earnings estimates for 2026 and 2027. Barclays maintained an Underweight rating with a $92 target. Prudential is also involved in a £2 billion pension risk transfer partnership.

Prudential Life Japan, a subsidiary of Prudential Financial, will partially resume sales in February 2027 after a business suspension, with full recovery taking up to 18 months. Japan operations contribute over 20% of the parent company's revenue. The suspension, due to a monetary fraud scandal, is expected to impact sales for at least two years, with 2027 and 2028 sales projected at 25% and 50% of 2025 levels, respectively.