PLD – Market expectations are for Uniform ROA to reach all-time highs, but management may have concerns about inventory, growth, and demand

• Prologis, Inc. (PLD:USA) currently trades at a recent high relative to UAFRS-based (Uniform) earnings, with a 52.1x Uniform P/E. At these levels, the market is pricing in bullish expectations for the firm, but management may have concerns about inventory, growth, and demand
• Specifically, management may be overstating the foundation they have built, and they may be concerned about the continued stability of e-commerce growth. In addition, they may lack confidence in their ability to provide space for expanding businesses, execute their leasing strategy in China, and manage the cost of carrying inventory. Furthermore, they may have concerns about the sustainability of incremental demand in inventory, the churn rate of smaller businesses, and missed opportunities from their volume mix. Management may also lack confidence in their ability to meet the market demand for large lots, sustain their core FFO per share, and capitalize on the current rent growth. Finally, they may be downplaying concerns about earnings growth, and they may lack confidence in their ability to start spec projects next quarter