2024-03-26 18:09:51 ET
Summary
- Back in mid-2023, I published a relatively bearish article on Prologis, Inc. because the fundamentals, in my opinion, did not justify the multiple.
- Since then, Prologis stock has delivered sound results, but, at the same time, facing weaker momentum in the core metrics.
- If we look deeper into the same store NOI figures and explore the sources of how Prologis could accommodate growth going forward, we will recognize that the market has priced in a lot.
- In my opinion, it is very unlikely that Prologis will manage to achieve the market's expectations that will, ultimately, cause the multiple to shrink, inflicting damage on the stock price.
- Based on the new data points, I would still recommend avoiding Prologis at the current multiple.
Mid last year, I wrote an article on Prologis, Inc. ( PLD ) - the largest publicly traded industrial real estate investment trust, or REIT - elaborating on the many fundamental areas where PLD is strongly positioned. Yet, after considering all of the inherent strengths (e.g., fortress balance sheet, embedded below market level rents), the conclusion was to avoid going long because of the excessive valuation levels....
Read the full article on Seeking Alpha
For further details see:
Prologis: There Is Still Too Much Baked Into The Cake To Capture Alpha