Prologis (PLD.US) stock briefly rose over 2.0% on Wednesday as the Q4 results exceeded analysts' forecasts despite the deteriorating economic conditions. Although the company's revenues increased by almost 33%, profits recorded a significant decrease on an annual basis:
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Revenue: $1.75bn vs. $1.42bn expected (FactSet) and $1.28bn in Q4 2021
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Earnings per share (EPS) $0.63 ($587.2 million) vs. $0.61 forecast (FactSet) and $1.67 ($1.25 billion) in Q4 2021
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Prologis informed that the occupancy rate of real estate is still growing, in Q4 2022 this figure reached 98% compared to 97.7% in Q3 2022, and company expects further positive development of operating activities in 2023;
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This real estate investment trust manages 113 million square meters of logistics space in 19 countries, used by over 6,500 major companies in the retail and e-commerce industry, so some analysts treat the company's results as an indicator of the broader economic situation.
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The latest macro data from the US suggest a deterioration in consumer sentiment (inflation is not falling without a reason) and a decline in economic activity, which may weigh heavily on the company in 2023.
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The company is currently valued with an average P/E of 24 points (slightly above the S&P 500 average) and a P/Bv of 3.18 (slightly below the S&P 500 average). The company's PEG Ratio fell from nearly 5.0 at the end of 2021 to 2.59.
Prologis (PLD.US) stock price is approaching the 200 SMA (red line), which could potentially hold back the bulls and become a catalyst for another downward move. On the other hand, should a break higher occur, recent upward impulse may accelerate towards resistance at $140.00, where August 2022 highs are located. Source: xStation5
