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Quote this valuation with its source: Fair value, Potential value and the price at analysis.
FAQ
PLD — frequently asked questions
Is Prologis, Inc. overvalued?
In our latest published analysis dated 2026-05-10, PLD looks meaningfully overvalued. The price recorded at analysis is USD 144 versus our fair value of USD 97.1; the high endpoint is presented separately as potential value of USD 116. That implies roughly 32.6% downside to fair value at that date.
Our latest published report, analyzed 2026-05-10, gives PLD a fair value of USD 97.1 and a potential value of USD 116. The conclusion is triangulated across multiple valuation models and weighted by reliability for Prologis, Inc.'s archetype; it is a dated research output, not a live price.
Should I buy PLD now?
Our latest published rating for PLD, analyzed 2026-05-10, is Sell. Prologis, Inc. looks meaningfully overvalued at the analysis-date price of USD 144 versus fair value of USD 97.1; potential value is USD 116. This is research for educational purposes, not personalized investment advice.
What are the biggest risks for PLD?
The dedicated bear-case section in our report analyzed 2026-05-10 documents Prologis, Inc.'s material risks, evidence, thresholds, and thesis-invalidation conditions. Scenario-specific explanations remain in that section so the report does not repeat or decontextualize them elsewhere.
What is PLD's rating?
Our latest published rating for PLD, analyzed 2026-05-10, is Sell, with a published moat assessment of 9/10 (Wide). It reflects our fair value of USD 97.1, the potential value of USD 116, and the price recorded at analysis (USD 144).
Bull: Even in an optimal scenario where secular e-commerce tailwinds drive peak occupancy and aggressive rent growth, shares remain fundamentally overvalued relative to the $115.97 upside target.
Main risk
E-commerce Capex Contraction: Major tenants structurally reduce logistics footprint expansion, severely depressing new leasing activity and mark-to-market rent spreads.
Prologis is a best-in-class industrial REIT with a massive global footprint, well-positioned to benefit from long-term secular tailwinds in e-commerce and supply chain optimization. However, shares are currently priced for absolute perfection, embedding an aggressive 11.5% long-term growth rate completely untethered from physical asset realities.
Prologis is a best-in-class industrial REIT with a massive global footprint, well-positioned to benefit from long-term secular tailwinds in e-commerce and supply chain optimization. However, shares are currently priced for absolute perfection, embedding an aggressive 11.5% long-term growth rate completely untethered from physical asset realities.
Global scale in critical logistics
Global scale in critical logistics hubs.
High barriers to entry in
High barriers to entry in tier-1 urban infill markets.
Cycle upside
E-commerce penetration re-accelerates, driving structural demand for modern logistics space.
House recommendation
Sell. The current valuation reflects a massive disconnect from intrinsic net asset value, yielding a clear baseline fair value of $97.12.
Company overview
Prologis, Inc. is a self-administered and self-managed REIT and is the sole general partner of Prologis, L.P. through which it holds substantially all of its assets. We operate Prologis, Inc. and Prologis, L.P. as one enterprise and, therefore, our discussion and analysis refer to Prologis, Inc. and its consolidated subsidiaries, including Prologis, L.P. We invest in real estate through wholly owned subsidiaries and other entities through which we co-invest with partners and investors (co-investment ventures). We have a significant ownership interest in the co-investment ventures, which are either consolidated or unconsolidated based on our level of control of the entity. Prologis, Inc. began operating as a fully integrated real estate company in 1997 and elected to be taxed as a REIT under the Internal Revenue Code of 1986, as amended (Internal Revenue Code or IRC). We believe the current organization and method of operation enable Prologis, Inc. to maintain its status as a REIT. Prologis, L.P. was also formed in 1997. We operate, manage and measure the operating performance of our properties on an owned and managed (O&M) basis. Our O&M portfolio includes our consolidated properties as well as properties owned by our unconsolidated co investment ventures, which we manage. We make operating decisions based on our total O&M portfolio as we manage the properties without regard to their ownership. Prologis, Inc. was incorporated in 1983 in Maryland, USA.
If net effective rent growth exceeds 5%, upside is fully capped by current valuation. If growth misses or goes negative, massive multiple contraction is highly likely.
In-line
Hold
Trigger: In-line results
If net effective rent growth exceeds 5%, upside is fully capped by current valuation. If growth misses or goes negative, massive multiple contraction is highly likely.
Miss
Reassess
Trigger: Downside surprise
If net effective rent growth exceeds 5%, upside is fully capped by current valuation. If growth misses or goes negative, massive multiple contraction is highly likely.
If net effective rent growth exceeds 5%, upside is fully capped by current valuation. If growth misses or goes negative, massive multiple contraction is highly likely.
Development financing dries up, constraining new supply and eventually tightening the market.
Bull cycle
E-commerce penetration re-accelerates, driving structural demand for modern logistics space.
Bear cycle
Retailers rationalize inventory, curbing warehouse space needs amidst economic cooling.
Positioning
Development financing dries up, constraining new supply and eventually tightening the market.
§11 Position management
Sizing
Avoid long exposure entirely. Utilize put spreads given the massive structural valuation premium.
Risk
Liquidate existing long positions entirely at current $144 levels.
Entry tranches
Level
Action
Why
Current / pullbacks
Do not enter long unless price meaningfully corrects below the $83 base-case downside target.
Do not enter long unless price meaningfully corrects below the $83 base-case downside target.
§12 Investor perspectives
Bull view
Buy
Upside case depends on the report valuation range and named growth catalysts.
Base view
Sell
While the underlying Prologis operating business is exceptional, the equity is severely mispriced relative to its intrinsic real estate value.
§14 Final recommendation
Action
Sell
Sell. The immense divergence between PLD's fundamentally sound real estate NAV ($97.12) and the current share price ($144.09) is unsustainable. Investors should rotate out immediately.
Reassess the thesis against the named valuation, risk, and quarterly checkpoint evidence in this report.
§15Your notes
Capture your own thesis, position size, and follow-up questions. Stays on this device, only you can see it.
A severe macroeconomic slowdown and localized oversupply rapidly compress rent growth, pushing fair value down to $83.17 as the market brutally corrects the implied growth premium.
Persistent top-line contraction reflects reduced tenant demand for warehouse space and rising customer square-footage consolidations, directly undermining tenant retention and weakening the long-term compounding narrative that underpins the valuation premium for industrial logistics portfolios.
Current:Revenue growth was 7.2% for the period ended 2025-12-31.
Alert if< 0.0% over any trailing twelve-month period
Sustained contraction in property gross margins indicates that leasing renewal spreads and rental revenues are failing to cover rising property maintenance costs and taxes, eroding the core cash generation required to sustain distribution growth and logistics platform reinvestment.
Current:Gross margin was 74.6% for the period ended 2025-12-31.
Alert if< 70.0% over any trailing twelve-month period
Operating profitability compression reflects escalating overhead, property management expenses, or rising tenant concessions across logistics assets, directly undermining operating leverage and diminishing the structural cash flow advantage derived from premier infill industrial real estate assets.
Current:Operating margin was 38.8% for the period ended 2025-12-31.
A substantial decline in capital productivity signals that large-scale development and acquisition deployments are generating sub-hurdle returns, demonstrating that asset productivity has impaired the company's ability to compound economic value above its long-term cost of capital.
Current:ROIC was 4.2% as of the report's 2026-05-10 analysis date.
Alert if< 3.0% over any trailing twelve-month period
Cash conversion falling below reported profitability indicates uncollected receivables or working capital drag, proving that reported net income is not being translated into actual distributable liquidity necessary to fund ongoing operations, capital expenditures, and debt service.
Even in an optimal scenario where secular e-commerce tailwinds drive peak occupancy and aggressive rent growth, shares remain fundamentally overvalued relative to the $115.97 upside target.
Logistics demand normalizes. Our primary baseline rests 85% on NAV/AFFO, producing a $97.12 fair value that highlights a massive 36% premium in current market pricing.
CurrentRevenue growth was 7.2% for the period ended 2025-12-31.
Why it matters
Warning level: < 0.0% over any trailing twelve-month period. Persistent top-line contraction reflects reduced tenant demand for warehouse space and rising customer square-footage consolidations, directly undermining tenant retention and weakening the long-term compounding narrative that underpins the valuation premium for industrial logistics portfolios.
CurrentGross margin was 74.6% for the period ended 2025-12-31.
Why it matters
Warning level: < 70.0% over any trailing twelve-month period. Sustained contraction in property gross margins indicates that leasing renewal spreads and rental revenues are failing to cover rising property maintenance costs and taxes, eroding the core cash generation required to sustain distribution growth and logistics platform reinvestment.
CurrentOperating margin was 38.8% for the period ended 2025-12-31.
Why it matters
Warning level: < 35.0% over any fiscal year. Operating profitability compression reflects escalating overhead, property management expenses, or rising tenant concessions across logistics assets, directly undermining operating leverage and diminishing the structural cash flow advantage derived from premier infill industrial real estate assets.
CurrentROIC was 4.2% as of the report's 2026-05-10 analysis date.
Why it matters
Warning level: < 3.0% over any trailing twelve-month period. A substantial decline in capital productivity signals that large-scale development and acquisition deployments are generating sub-hurdle returns, demonstrating that asset productivity has impaired the company's ability to compound economic value above its long-term cost of capital.
Warning level: < 1.00x over any trailing twelve-month period. Cash conversion falling below reported profitability indicates uncollected receivables or working capital drag, proving that reported net income is not being translated into actual distributable liquidity necessary to fund ongoing operations, capital expenditures, and debt service.
