What Do You Need to Know About Prologis (PLD) Before Investing?

Prologis logged a -1.2% change during today's afternoon session, and is now trading at a price of $122.28 per share.

Over the last year, Prologis logged a -5.0% change, with its stock price reaching a high of $138.86 and a low of $98.03. Over the same period, the stock underperformed the S&P 500 index by -15.0%. As of April 2023, the company's 50-day average price was $123.44. Prologis, Inc. is the global leader in logistics real estate with a focus on high-barrier, high-growth markets. Based in San Francisco, CA, the large-cap Real Estate company has 2,466 full time employees. Prologis has offered a 2.7% dividend yield over the last 12 months.

Growing Revenues With a Flat Capital Expenditure Trend:

2020-02-11 2021-02-11 2022-02-09 2023-02-14
Revenue (MM) $3,331 $4,439 $4,759 $5,974
Operating Margins 29.8% 31.6% 34.0% 38.2%
Net Margins 47.23% 33.38% 61.77% 56.33%
Net Income (MM) $1,573 $1,482 $2,940 $3,365
Net Interest Expense (MM) -$240 -$315 -$266 -$309
Depreciation & Amort. (MM) -$1,140 -$1,562 -$1,578 -$1,813
Earnings Per Share $2.39 $1.95 $3.84 $3.2
EPS Growth n/a -18.41% 96.92% -16.67%
Diluted Shares (MM) 655 754 765 923
Free Cash Flow (MM) $5,208 $4,326 $5,486 $6,830
Capital Expenditures (MM) -$2,944 -$1,389 -$2,490 -$2,703
Net Current Assets (MM) -$12,151 -$18,072 -$19,518 -$29,225
Current Ratio 0.88 0.58 0.4 0.13
Long Term Debt (MM) $11,906 $16,849 $17,715 $23,876

Prologis benefits from growing revenues and a flat capital expenditure trend, strong margins with a positive growth rate, and a steady stream of strong cash flows. The company's financial statements show healthy debt levels and positive EPS growth.

Prologis's Valuation Is in Line With Its Sector Averages:

Prologis has a trailing twelve month P/E ratio of 38.6, compared to an average of 24.81 for the Real Estate sector. Based on its EPS guidance of $3.12, the company has a forward P/E ratio of 39.6. The 5.5% compound average growth rate of Prologis's historical and projected earnings per share yields a PEG ratio of 7.05. This suggests that these shares are overvalued. In contrast, the market is likely undervaluing Prologis in terms of its equity because its P/B ratio is 2.12 while the sector average is 2.24. The company's shares are currently trading 101.2% above their Graham number. In conclusion, Prologis's impressive cash flow trend, decent P/B ratio, and reasonable use of leverage demonstrate that the company may still be fairly valued — despite its elevated earnings multiple.

Prologis Has an Average Rating of Buy:

The 21 analysts following Prologis have set target prices ranging from $128.0 to $162.0 per share, for an average of $142.57 with a buy rating. As of April 2023, the company is trading -13.4% away from its average target price, indicating that there is an analyst consensus of some upside potential.

Prologis has a very low short interest because 1.2% of the company's shares are sold short. Institutions own 95.5% of the company's shares, and the insider ownership rate stands at 0.32%, suggesting a small amount of insider investors. The largest shareholder is Vanguard Group Inc, whose 13% stake in the company is worth $14,960,277,729.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.