Investment Rating - The report maintains a "Buy" rating for Prologis (PLD US) with a target price of $134.94, indicating a potential upside of 34.6% from the current price of $100.29 [5]. Core Insights - Prologis reported Q1 2025 results that were broadly in line with expectations, with rental and related income of $1.99 billion, a year-on-year increase of 8.7%. Adjusted EBITDA was $1.77 billion, up 10.8% year-on-year [1][2]. - The company maintains its 2025 earnings guidance, projecting net income per share of $3.45-$3.70 and core FFO per share of $5.65-$5.81 [1][2]. - Prologis signed new leases totaling over 58 million square feet and made progress in its data center business, expanding power capacity to meet growing demand [1]. Financial Performance Summary - As of Q1 2025, the overall occupancy rate remained high at 94.9%, with a tenant retention rate of 72.9% and net effective rent growth slowing to 53.7% [1]. - The debt to EBITDA ratio stood at 4.9 times, with a debt to total market value ratio of 25.7%, indicating a healthy financial position [1]. - The average cost of debt was 3.2%, with a weighted average maturity of 8.7 years, suggesting stable financial costs in the coming years [1].

Group 1 - The article discusses a value investing approach focusing on classical value ratios such as low P/B, P/FCF, and Owner Earnings discounting [1] - It emphasizes the importance of tracking earnings growth versus price appreciation for quality evaluation [1] - The author advocates for self-indexing using the Dow Jones Industrial Average combined with Joel Greenblatt's Magic Formula for tax efficiency [1] Group 2 - The author has a beneficial long position in shares of PLD, O, AMT, and AMZN through various financial instruments [2] - The article expresses the author's personal opinions and is not influenced by compensation from any company mentioned [2] Group 3 - The information provided is for general informational purposes and should not be considered as financial advice [3] - The author is not a licensed financial advisor or CPA, and the content may not be suitable for all financial situations [3]

Financial Data and Key Metrics Changes - Prologis reported a core FFO of $1.42 per share, including net promotes, and $1.43 per share excluding net promotes, both exceeding forecasts [14] - Occupancy at the end of the quarter was 95.2%, a decrease of 70 basis points from year-end, attributed to strong retention [14] - Net effective rent change during the quarter was 54%, with cash basis at 32%, leading to same-store growth of 5.9% and 6.2% respectively [15] - The net effective lease mark-to-market ended at 25%, representing an additional $1.1 billion of incremental NOI [15][16] Business Line Data and Key Metrics Changes - Prologis leased 58 million square feet, nearing record levels, and initiated approximately $650 million in new developments, with 80% being build-to-suit projects [9][16] - The data center business expanded power capacity by 400 megawatts, a 13% increase, totaling 2 gigawatts in advanced stages [9][18] Market Data and Key Metrics Changes - The operating environment showed increased leasing activity in sectors like transport, food and beverage, consumer products, and electronics [20] - Net absorption for the quarter was 21 million square feet, with a global decline of 1.5%, primarily in Southern California [79] Company Strategy and Development Direction - The company aims to invest in markets where goods are consumed rather than produced, emphasizing the need for more warehouse space in a disconnected world [13][92] - Prologis plans to reduce development start guidance to $1.5 billion to $2 billion due to uncertainty in the market [31] Management's Comments on Operating Environment and Future Outlook - Management expressed concerns about potential recession impacts on consumption and decision-making, while also noting the resilience of Prologis due to its diversified rent roll and strong balance sheet [11][12] - The company anticipates increased inventory levels as businesses stockpile, with e-commerce expected to gain more market share [28] Other Important Information - Prologis raised approximately $400 million in new capital for its flagship open-ended funds, with a similar amount in redemptions, resulting in a near-neutral capital raise [19] - The company received a Moody's upgrade to an A2 rating, making it one of only two public REITs with an A-flat rating from both agencies [19] Q&A Session Summary Question: Insights on customer interactions and demand - Management noted that consumption is expected to decline in a recession, but long-term trends indicate growth [40][41] Question: Clarification on leasing and occupancy - The occupancy drop was attributed to a high number of leases rolling in the first quarter, with retention at 73% [48] Question: Stress test scenarios and market conditions - The stress test indicated potential occupancy declines and rent drops, with bad debt expectations adjusted to 75 basis points [78] Question: Impact of tariffs on customers - Management speculated that customers could absorb a 10% tariff, with Mexico expected to benefit from shifts in sourcing [86] Question: Demand for warehouse space - The company believes that a disconnected world will require more warehouse space due to the need for inventory and supply chain adjustments [91][92]

Core Insights - Prologis, Inc. reported first-quarter 2025 core funds from operations (FFO) per share of $1.42, exceeding the Zacks Consensus Estimate of $1.38 and up from $1.28 in the same quarter last year [1][2] - The company generated rental revenues of $1.99 billion, surpassing the Zacks Consensus Estimate of $1.94 billion, and increased from $1.83 billion year-over-year [3] - Total revenues reached $2.14 billion, up from $1.96 billion in the prior year [3] Financial Performance - The average occupancy level in Prologis' owned and managed portfolio was 94.9%, down from 95.6% in the previous quarter and 96.8% year-over-year [5] - Cash same-store net operating income (NOI) grew 6.2% compared to 6.7% in the previous quarter [5] - Interest expenses increased by 19.9% year-over-year to $231.8 million [7] Leasing and Development - In the quarter, 65.1 million square feet of leases commenced, with a retention level of 72.9% [4] - The company's share of building acquisitions amounted to $811 million, with a weighted average stabilized cap rate of 4.2% [6] - Development stabilization totaled $925 million, with 64.5% being built to suit [6] Liquidity and Debt - Prologis ended the first quarter with cash and cash equivalents of $671.1 million, down from $1.32 billion at the end of the previous quarter [8] - Total liquidity was $6.52 billion, with debt as a percentage of total market capitalization at 25.7% [8] - The weighted average interest rate on total debt was 3.2%, with a weighted average term of 8.7 years [8] 2025 Guidance - The company reaffirmed its 2025 core FFO per share guidance in the range of $5.65-$5.81, with the Zacks Consensus Estimate at $5.71 [10] - Average occupancy is expected to be between 94.5% and 95.5%, with cash same-store NOI projected in the range of 4-5% [10] - The outlook for capital deployment on development starts has been lowered to $1.50-$2.00 billion from $2.25-$2.75 billion [11]

Core Viewpoint - Prologis reported quarterly funds from operations (FFO) of $1.42 per share, exceeding the Zacks Consensus Estimate of $1.38 per share, and showing an increase from $1.28 per share a year ago, indicating a positive performance trend [1][2] Financial Performance - The company achieved revenues of $1.99 billion for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 2.68% and up from $1.83 billion year-over-year [2] - Prologis has consistently surpassed consensus FFO estimates over the last four quarters, achieving a surprise of 2.90% in the latest report [1][2] Market Position and Outlook - Prologis shares have declined approximately 6.8% since the beginning of the year, which is better than the S&P 500's decline of 8.3% [3] - The future performance of Prologis stock will largely depend on management's commentary during the earnings call and the outlook for FFO [3][4] Estimate Revisions and Consensus - The current consensus FFO estimate for the upcoming quarter is $1.41 on revenues of $1.97 billion, and for the current fiscal year, it is $5.71 on revenues of $7.96 billion [7] - The estimate revisions trend for Prologis is mixed, resulting in a Zacks Rank 3 (Hold), indicating expected performance in line with the market [6] Industry Context - The REIT and Equity Trust - Other industry, to which Prologis belongs, is currently ranked in the bottom 35% of over 250 Zacks industries, which may impact stock performance [8]

Company Overview - Prologis owned or had investments in properties and development projects totaling approximately 1.3 billion square feet (120 million square meters) across 20 countries as of March 31, 2025[9]. - Prologis' gross assets under management (AUM) reached $207 billion, with 84% of this value derived from the U.S. market[19][22]. - The company reported a total asset value of $95,993,391 as of March 31, 2025, compared to $95,328,909 at the end of 2024, indicating a growth of 0.7%[56]. - The total liabilities stood at $22,337.816 million, with third-party debt accounting for $18,441.978 million[121]. - The total value of assets under management is $157,044,079,000[171]. Financial Performance - Total revenues for Q1 2025 were $2.14 billion, an increase from $1.96 billion in Q1 2024, representing a growth of 9.3%[28]. - Core FFO attributable to common stockholders/unitholders for Q1 2025 was $1.36 billion, up from $1.22 billion in Q1 2024, reflecting a year-over-year increase of 11.1%[28]. - Net earnings attributable to common stockholders for Q1 2025 were $591,501, up from $584,263 in Q1 2024, reflecting a growth of 1.9%[59]. - Operating income for Q1 2025 was $878,413, representing a 22% increase from $720,355 in Q1 2024[57]. - Total rental revenue for Q1 2025 reached $1,250.801 million, with the U.S. contributing $407.564 million[121]. - Core FFO per share - Diluted increased to $1.42 in Q1 2025 from $1.28 in Q1 2024, marking a rise of approximately 10.9%[156]. Development and Expansion - Estimated value creation from development stabilizations for Q1 2025 was $240 million, significantly higher than $50 million in Q1 2024[28]. - Development stabilizations are expected to range from $1.9 billion to $2.3 billion in 2025, highlighting ongoing expansion efforts[53]. - The total development portfolio is valued at $2.65 billion, with an estimated NOI of $4.47 billion and a percentage leased of 190%[141]. - The estimated weighted average stabilized yield for development stabilizations in Q1 2025 is 6.9%, with an annualized estimated NOI of $63.444 million[95]. - The estimated weighted average margin for development stabilizations is 26.0%[95]. Operational Metrics - Average occupancy rate for owned and managed properties was 96.8% in Q1 2025, slightly down from 97.0% in Q4 2024[64]. - The company reported a customer retention rate of 78.4% in Q1 2025, down from 80% in Q4 2024[68]. - The average occupancy for the same store information was 95.5% in Q1 2025, with a cash NOI increase of 6.2%[75]. - The total operating portfolio reached 2,319,670 square feet, with an occupancy rate of 95.2%[86]. - The total square feet of leases commenced in Q1 2025 was 63,251, representing a significant increase from 42,960 square feet in Q4 2024[72]. Debt and Liquidity - Debt increased to $32,262,055 in Q1 2025 from $30,879,263 in Q4 2024, marking a rise of 4.5%[56]. - The company's debt as a percentage of gross market capitalization was 25.7%, indicating a stable leverage position[126]. - Total consolidated debt, net of premiums and discounts, amounts to $29.39 billion, with a total liquidity of $6.52 billion[135]. - The percentage of floating rate debt is 5.4%, reflecting a moderate exposure to interest rate fluctuations[134]. - Prologis has a total debt of $32.26 billion, with 95% of it being fixed rate[135]. Market Outlook - The company provided guidance for 2025, projecting net earnings attributable to common stockholders between $3.45 and $3.70 per share[53]. - Prologis anticipates same store NOI growth of 4.00% to 5.00% for 2025, indicating a positive outlook for operational performance[53]. - The company anticipates further market expansion with new ventures expected to stabilize by Q4 2025[120]. Customer and Market Dynamics - The top customer, Amazon, accounted for 5.0% of net effective rent, occupying 45,680 square feet[87]. - The remaining lease expirations indicate that 36.6% of total occupied square feet will expire thereafter, with a weighted average rent of $9.08 per square foot[88]. - Prologis Share of Same Store Property NOI - Net Effective increased by 5.9% to $1,492,688 thousand in Q1 2025 compared to $1,409,007 thousand in Q1 2024[187]. Sustainability and Energy Initiatives - The total solar and energy storage portfolio has a capacity of 253 MW and a gross book value of $376,172,000[107]. - The total installed capacity for solar projects is 638 MW, with an estimated weighted average stabilized yield of 11.6%[107]. - The total current investment in solar projects under development is $395,672,000[107].

Core Insights - Prologis reported strong operational performance for Q1 2025, with 58 million square feet of leases signed and significant expansion in data center capacity [1][2] - The company maintains a robust balance sheet and liquidity, positioning itself to capitalize on emerging opportunities despite current policy uncertainties [2][5] Operating Performance - Average occupancy for Prologis was 94.9% in Q1 2025, with leases commenced totaling 65.1 million square feet and a retention rate of 72.9% [3] - Cash same-store net operating income (NOI) increased by 6.2%, while net effective rent change rose by 53.7% and cash rent change increased by 32.1% [3] Deployment Activity - Prologis made acquisitions totaling $811 million with a weighted average stabilized cap rate of 4.2% [4] - Development stabilizations amounted to $925 million, with an estimated weighted average yield of 6.9% and a value creation estimate of $240 million [4] - The company initiated development starts worth $646 million, with an estimated weighted average yield of 6.6% [4] Financial Performance - Total revenues for Q1 2025 reached $2.14 billion, up from $1.96 billion in Q1 2024 [16] - Net earnings attributable to common stockholders were $591.5 million, consistent with the previous year, while core funds from operations (Core FFO) increased by 10.9% to $1.42 per diluted share [8][16] - The company reported total available liquidity of approximately $6.5 billion, with a debt-to-EBITDA ratio of 4.9x [9] Guidance - Prologis maintained its earnings guidance for 2025, projecting net earnings per diluted share between $3.45 and $3.70 and Core FFO between $5.65 and $5.81 [7][11] - The company expects average occupancy to remain between 94.5% and 95.5% and cash same-store NOI growth of 4.0% to 5.0% [10]

Core Viewpoint - Prologis is expected to report its first-quarter 2025 results on April 16, with analysts and investors keen to evaluate its performance amid current economic conditions [1] Company Performance - In the last reported quarter, Prologis achieved an 8.70% surprise in core funds from operations (FFO) per share, driven by increased rental revenues and strong leasing activity, although high interest expenses posed challenges [2] - Over the past four quarters, Prologis exceeded the Zacks Consensus Estimate for FFO per share three times, with an average beat of 3.46% [2] Industry Overview - The U.S. industrial real estate market demonstrated resilience in Q1 2025, with steady demand despite tariff uncertainties, although vacancy rates rose and rent growth moderated [3] - Net absorption for the first quarter was 23.1 million square feet, matching the previous year's level but down from 42.4 million square feet in Q4 [4] - The overall vacancy rate increased by 30 basis points to 7%, the highest since 2014, indicating a shift towards a more balanced market [5] - Asking rents have flattened, with a year-over-year growth of 4.3%, while the national average rent remained stable at $10.11 per square foot [6] Development Trends - The development pipeline is shrinking, with Q1 2025 seeing 72.6 million square feet of new industrial buildings completed, a 41% year-over-year decline [7] - Speculative assets made up 72% of the total square footage delivered in the first quarter [7] Strategic Positioning - Prologis is well-positioned to navigate the industrial real estate landscape, leveraging its portfolio of premium assets and focusing on targeted acquisitions and developments [8] - The company is expected to utilize its cost efficiency and strong balance sheet to drive growth initiatives, reinforcing its market leadership [9] Financial Projections - The Zacks Consensus Estimate for Prologis' first-quarter revenues is $1.94 billion, reflecting a 5.89% year-over-year increase [10] - Average occupancy is projected at 95.5%, indicating an 80 basis points decrease from the prior quarter, while same-store net operating income is expected to rise by 3.7% year over year [10] - Interest expenses are anticipated to increase by 13.3% year over year in the first quarter [10] Analyst Sentiment - Analysts have not revised the Zacks Consensus Estimate for first-quarter FFO per share, which remains at $1.38, suggesting a 7.81% year-over-year increase [11] - Prologis holds a Zacks Rank of 3 and an Earnings ESP of +0.21%, indicating potential for an FFO beat this quarter [12]

Group 1 - Financial markets are currently experiencing negative sentiment due to concerns over the trade war [1] - Despite the trade war, there are numerous companies operating in the U.S. market that may present investment opportunities [1] - The analyst has a background in macroeconomics and market trends, with experience in both Russian and Ukrainian financial markets [1] Group 2 - The analyst has been involved in financial markets since 2005 and has worked in various roles, including as a financial markets analyst [1] - The transition to Seeking Alpha represents a move from a regional to a global market perspective [1]

MEXICO CITY, April 11, 2025 /PRNewswire/ -- FIBRA Prologis (BMV: FIBRAPL 14), a leading owner and operator of Class-A industrial real estate in Mexico, today announced it will host an ordinary certificate holders meeting on April 25, 2025, at 11:00 am Mexico Time. The meeting agenda includes the following items: I. Proposal, discussion and, if applicable, approval of the Trust's audited annual financial statements, corresponding to the fiscal year 2024, in accordance with Clause 4.3, subsection (a), nume ...