PLD - Embedded Expectations Analysis - 2020 11 09
Prologis, Inc. (PLD:USA) currently trades at recent highs relative to UAFRS-based (Uniform) earnings, with a 52.1x Uniform P/E. At these levels, the market is pricing in bullish expectations for the firm, but management may have concerns about the sustainability of demand, their ability to improve leasing, and Walmart's online transitionSpecifically, management may lack confidence in their ability to execute the sale of Liberty's portfolio in the U.K., improve strategic capital revenue, and sustain their overall rent collections. They may also be exaggerating the acceleration of lease proposals, and they may have concerns about the sustainability of demand. Finally, they may be downplaying concerns about the leasing impact due to Walmart's online transition, and they may lack confidence in their ability to further reduce logistics costs
Prologis is a self-administered and self-managed real estate investment trust and is the sole general partner of Prologis, L.P. The company owns, manages and develops logistics facilities, with a focus on the consumption side of the global supply chain. Most of the company's properties in the United States are wholly owned, while its properties outside the United States are primarily held in co-investment ventures. The company has two segments: Real Estate Operations, which represents the ownership and development of operating properties, and includes land held for development and properties under development; and Strategic Capital, which represents the management of unconsolidated co-investment ventures.
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