Prologis Inc

Prologis’s (PLD) upbeat top-line and bottom-line results in 2Q17 were driven by higher-than-expected rent growth and net operating income.

The rising interest rate is expected to boost the economy in the long run, but it could severely impact sectors like real estate.

Prologis has noted a 15.0% rise in revenue in the first half of 2017, driven by every segment. Operating income rose 61.0% despite higher expenses.

REITs depend on equity and debt for their working capital.

Although it is a common belief that high interest rates are usually bad for REITs like Boston Properties (BXP), Simon Property (SPG), Prologis (PLD), and Vornado Realty Trust (VNO), we find that REITs have continued in their growth trajectory in the past few months.

REITs have flourished for a considerable period in a record-low-interest-rate environment because they depend on debt and equity for their working capital.

Boston Properties raised its EPS (earnings per share) outlook for 2017 to a range of $2.72 to $2.77 per share.

The growing economy has acted as a boon to REITs, and with the help of their strategic initiatives, these REITs have been able to take advantage of the opportunity and report higher revenue and profits.

Boston Properties’ recent upbeat results came on the back of higher leasing activity as well as strong occupancy levels, which led to revenue growth.

GGP’s (GGP) debt-to-equity was 1.55x for 2Q17, which was higher than the industrial mean of 1.07x. As of 2Q17, GGP had $2.0 billion of liquidity.

The price-to-FFO multiple is the best way to evaluate Prologis (PLD).

Prologis maintained a debt-to-equity ratio of 0.75x for 2Q17, which was lower than the industrial mean of 1.07x.

Prologis’s (PLD) properties are spread across the globe. This geographical diversity ensures that the company gets the optimum value from the retail and supply chains in different parts of the world.

Prologis (PLD) reported better-than-expected 2Q17 top-line and bottom-line results.

Prologis (PLD) reported core funds from operation (or FFO) of $0.84 per share in 2Q17, which surpassed Wall Street’s estimates of $0.77 by a remarkable 9.1%.

Analysts have assigned Prologis stock a mean price target of $58.47, which is 2.1% higher than its current price of $57.28.

In terms of price-to-FFO multiple, PLD trades at par with most of its peers except Brandywine Realty Trust (BDN).

In addition to Prologis’s strategic initiatives such as acquisitions, dispositions, and project development activities, several macroeconomic factors also impact performance.

Wall Street expects Prologis to report adjusted FFO (funds from operations) of $0.76, a 27.3% rise year-over-year.

According to Wall Street analysts, Prologis (PLD) is expected to report NOI (net operating income) of $440.2 million in 2Q17.

Prologis (PLD) is expected to see higher revenue growth as well as higher margins for 2Q17.

Analysts expect Prologis (PLD) to report revenue of $583.5 million for 2Q17 when it releases its earnings on July 18, 2017.

Prologis (PLD) is scheduled to report its fiscal 2Q17 earnings on July 18. 2017. Analysts expect it to report adjusted FFO (funds from operations) of $0.76.

Prologis’s price-to-FFO multiple is now 20.95x, which means that it has been returning consistent capital value and reliable dividend yields to investors.

Prologis is expected to achieve a growth rate of 6%, 5.8%, 9.1% and 8.7%, respectively, in AFFO (adjusted funds from operations) over the next four quarters.

Rent increased 0.4% for industrial properties in 2Q15, which was unchanged from the previous quarter, but lower than the 0.5% 2Q14 growth.