Overview
BTIG analyst Thomas Catherwood has designated Prologis, Inc. (NYSE:PLD) as his top investment pick for the second half of 2026, citing the company’s robust second‑quarter 2026 performance that beat expectations and led to an upward revision of guidance.
Financial Performance
- The company reported second‑quarter 2026 Core Funds From Operations (FFO) of $1.63 per share, exceeding Catherwood’s estimate by $0.09 and the consensus estimate by $0.08.
- Revenue for the quarter was $2.43 billion, and adjusted earnings per share were $1.13, both above analyst forecasts.
- Occupancy rose 20 basis points sequentially to 95.5%, while tenant retention slipped to 72.7%, the lowest level in twelve quarters.
- GAAP same‑store net operating income grew 6.4% year‑over‑year, and cash same‑store NOI grew 8.5%.
- Leasing spreads were 36.9% on a GAAP basis and 22.3% on a cash basis.
Guidance and Outlook
- Management increased the midpoint of its full‑year 2026 Core FFO guidance by $0.11 to $6.26 per share, expanding the range to $6.22‑$6.30 per share.
- The forward leasing pipeline now stands at 129 million square feet, roughly 50% above the long‑term average.
- Prologis plans to commence $5.0 billion of new development projects in 2026, representing a $1.0 billion sequential increase and a 43% rise since the start of the year.
- Revised development guidance suggests approximately $2.0 billion of additional project starts for the remainder of the year.
Leasing Activity and Development
- During the quarter the company signed more than 67 million square feet of leases, surpassing the previous record of 64 million square feet set in Q1 2026.
- It initiated $540 million of industrial projects and $802 million of data‑center projects, totaling $1.3 billion of starts at an estimated stabilized yield of 7.2%.
Analyst Rating
- BTIG assigns a Buy rating to Prologis with a price target of $170 per share.