Long-term U.S. Treasury yields have jumped to levels not seen in years, and that shift is quietly reshaping who wins and who struggles in the market. Life insurers and annuity providers sit close to this story because their business models are tightly linked to where those yields settle. This article examines three stocks from our higher yield screener that may be well positioned and explains how the recent move in rates and inflation could matter for your portfolio.
The stocks highlighted below are a small sample from this theme, and the full screen surfaced 10 more U.S. life insurers and annuity providers with equally compelling stories that are not covered here. If you want to identify which ones best fit your risk profile and income goals, analyze the full US Life Insurance and Annuity Providers Leveraging Higher Long-Term Yields screener through the US Life Insurance and Annuity Providers Leveraging Higher Long-Term Yields screener.
Principal Financial Group (PFG)
Principal Financial Group ties directly into the higher long-term yield theme through its mix of retirement, annuity, and insurance products, where reinvestment rates and spreads matter. Its sizeable asset management arm adds a fee-based counterweight to rate-sensitive earnings.
Principal Financial Group runs a diversified financial services platform, with Retirement and Income Solutions generating about US$7.8b of revenue, Benefits and Protection around US$5.0b, and Principal Asset Management roughly US$2.9b, on top of a US$23.0b market cap.
"Principal Asset Management is shifting its mix toward private markets, active ETFs, and international pension mandates, with growth in related assets and inflows expected to help offset active equity outflows and fee rate pressure and to support more resilient revenue."
What happens to margins and growth if one pressure point in that mix shift does not move in Principal Financial Group’s favor?
If that pressure point has you wondering what could accelerate or stall the story, read the full narrative for Principal Financial Group to see how management plans to keep earnings resilient.
Lincoln National (LNC)
Lincoln National is closely linked to the higher long-term yield story because its life insurance and annuity contracts are backed by long-duration fixed-income portfolios that react directly to where Treasury rates settle.
Lincoln National runs a broad U.S. protection and retirement platform, with about US$6.0b from Life Insurance, US$5.7b from Annuities, US$6.2b from Group Protection and US$1.4b from Retirement Plan Services, and a market cap near US$7.7b.
"Although Lincoln National is tilting its annuity mix toward spread-based products, the continued structural runoff in traditional variable annuity balances, with net outflows of about US$2.7b in Q2 2026 and US$2.2b in Q1 2026, can still weigh on fee revenue and dilute the earnings uplift investors expect from the product shift."
The extent to which those higher long-term yields translate into lasting spread strength, rather than simply exposing an unresolved pressure on cash generation, will be important.
If you want to see whether that spread strength is quietly masking or accelerating Lincoln National’s cash story, read the full narrative for Lincoln National for the full picture.
Prudential Financial (PRU)
Prudential Financial brings the higher long-term yield story to life through its mix of retirement, annuity and insurance contracts that are funded by large bond portfolios, while PGIM, International Businesses at about US$18.5b, U.S. Group Insurance at roughly US$6.8b and Individual Life near US$6.3b support a roughly US$39.2b market cap.
Prudential Financial is a central player in this higher-yield theme because so much of its retirement and insurance income depends on the spread between what it earns on long-dated bonds and what it credits to policyholders. This is exactly where long-term Treasury moves can either bite or help.
"Prudential Financial is reallocating well north of US$3b of capital by exiting multiple emerging markets and concentrating on the U.S., Japan and select European operations along with PGIM."
What happens to that carefully planned capital shift if one pressure point in the higher-yield backdrop twists the expected spread story?
If that spread story has you thinking about how Prudential Financial could turn this capital reshuffle into accelerating earnings power, read the full narrative for Prudential Financial to see how the thesis really plays out.
Seeking Alternatives Before The Crowd
New themes can gain momentum quickly. By the time everyone notices, the cleanest breakout opportunities may already be moving. Scan fresh ideas while they are still under the radar and consider them before they become widely followed.
- Target companies that generate steady cash flow and have a track record of supporting their payouts by scanning the 7 dividend fortresses before yield-focused investors narrow the available opportunities.
- Look for potential AI leaders while they may still be viewed as underdogs by running the 38 profitable AI stocks that aren't just burning cash before broader attention potentially changes how they are perceived.
- Review companies involved in infrastructure and grid upgrades by using the 41 power grid technology and infrastructure stocks while these potential enablers are still in a relatively early phase of building recognition.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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