PLD
Prologis, Inc.
Real Estate · REIT - Industrial · United States · Stock
Score Breakdown
Scored for Dividend Income profile
Sub-scores are 0–20 each; Model Score is weighted by your selected investment goal. How it works →
Why Ranked Here
- Strong financial health and profitability scores reflect the company's conservative leverage, high margins, and large asset base, which anchor the composite score.
- Growth and momentum scores were weighed down by declining net income and EPS alongside a highly volatile quarterly revenue pattern, limiting upside to the total score.
- The dividend score was modestly positive given consistent per-share growth, but the above-100% payout ratio prevented a higher contribution, and the macro theme assignment did not translate into a positive score under the model's methodology.
Why Not Higher
- The combination of falling net income (-10.8%), declining EPS (-11.2%), and a payout ratio of 113.1% signals that earnings quality and dividend coverage are under pressure, constraining the overall score.
- The anomalous 2025Q4 figures — deeply negative revenue and operating income — introduced momentum volatility that the model penalized, and the Supply Chain Reshoring theme assignment did not contribute positively to the score.
Data Confidence
9 / 10
Very High — full data coverage
Why This Score
Grounded in figures from this company's SEC EDGAR filings — not a restatement of the score itself.
Revenue grew from FY2024's $8,201,610,000 to FY2025's $8,790,127,000, a gain of +7.2%, but net income fell -10.8% over the same period (FY2024: $3,731,635,000 to FY2025: $3,328,231,000), and diluted EPS declined -11.2% from FY2024's $4.01 to FY2025's $3.56.
The model rewarded modest top-line expansion but penalized the meaningful contraction in bottom-line profitability and per-share earnings, resulting in a below-average growth score.
In FY2025, Prologis posted an operating margin of 49.6% and a net margin of 37.9%, while return on assets stood at 3.4%.
The model rewarded the exceptionally high operating and net margins as evidence of strong earnings quality, though the relatively modest return on assets — reflecting the capital-intensive nature of the business — tempered the score slightly below the maximum.
In FY2025, Prologis carried a debt-to-equity ratio of 0.66, an interest coverage ratio of 4.3, and total assets of $98,724,256,000.
The model rewarded the conservative leverage profile and adequate interest coverage as indicators of balance-sheet resilience, with the large asset base further supporting a near-maximum financial health score.
Quarterly revenue showed a distorted pattern — 2025Q2: $2,183,869,000, 2025Q3: $2,213,881,000, 2025Q4: -$4,284,703,000, and 2026Q1: $2,297,723,000 — while operating income similarly swung from 2025Q2: $912,712,000 and 2025Q3: $940,261,000 to a deeply negative 2025Q4: -$1,104,908,000 before recovering to 2026Q1: $1,211,055,000. Net income, by contrast, remained positive across all four quarters.
The large negative revenue and operating income figures in 2025Q4 introduce significant volatility into the trailing trend, which the model likely penalized as inconsistent momentum despite the 2026Q1 recovery.
Dividends per share have risen consistently from FY2022's $3.16 to FY2023's $3.48, FY2024's $3.84, and FY2025's $4.04, but the FY2025 dividend payout ratio stands at 113.1% of net income.
The model rewarded the unbroken multi-year dividend growth trend but discounted the score because a payout ratio exceeding 100% signals that dividends are not fully covered by reported net income, raising sustainability questions.
Prologis is assigned to the Supply Chain Reshoring macro theme.
Although the Supply Chain Reshoring theme is assigned, this assignment did not translate into a positive score under the model's current methodology.
Research Summary
AI-generated analysis reflects data and conditions as of the report date shown above. Verify any specific figures through primary sources before acting on this analysis.
Prologis posted modest top-line growth of +7.2% from FY2024 to FY2025, but net income fell -10.8% and diluted EPS declined -11.2% over the same period, creating a mixed growth picture. The company's balance sheet is a clear strength, with a debt-to-equity ratio of 0.66, interest coverage of 4.3x, and total assets of nearly $98.7 billion, while operating and net margins of 49.6% and 37.9% respectively reflect strong earnings quality. Quarterly momentum was disrupted by a deeply negative revenue and operating income figure in 2025Q4, introducing volatility that tempered the momentum assessment despite a recovery in 2026Q1. The dividend has grown consistently from $3.16 in FY2022 to $4.04 in FY2025, but a payout ratio of 113.1% raises questions about near-term sustainability.
Plain English
Prologis is a large, financially solid real estate company that brings in strong margins and keeps its debt low, but its profits shrank last year, one quarter had a strange negative revenue figure that rattled the trend, and it's paying out more in dividends than it earns in net income — so there are real questions worth digging into before committing.
Bull Case vs. Bear Case
Bull Case
- Exceptional profitability: Prologis generated an operating margin of 49.6% and a net margin of 37.9% in FY2025, demonstrating strong earnings quality relative to its revenue base.
- Conservative balance sheet: A debt-to-equity ratio of just 0.66 and interest coverage of 4.3x, backed by nearly $98.7 billion in total assets, signal meaningful financial resilience.
- Consistent dividend growth: Dividends per share have risen every year from $3.16 in FY2022 to $4.04 in FY2025, reflecting a multi-year commitment to returning capital to shareholders.
Bear Case
- Deteriorating bottom line: Despite revenue growing +7.2%, net income fell -10.8% and diluted EPS dropped -11.2% from FY2024 to FY2025, signaling that profitability is not keeping pace with top-line expansion.
- Dividend sustainability concern: The FY2025 payout ratio of 113.1% means dividends exceeded reported net income, raising questions about how long the current dividend level can be maintained without earnings improvement.
- Momentum disruption: A deeply negative revenue figure of -$4,284,703,000 and operating income of -$1,104,908,000 in 2025Q4 introduced significant volatility into the trailing trend, making near-term trajectory difficult to assess.
What Could Change the Picture
Bullish Triggers
- A return to net income growth — reversing the -10.8% decline seen from FY2024 to FY2025 — would meaningfully strengthen the investment case and ease dividend sustainability concerns.
- Clarification or normalization of the anomalous 2025Q4 negative revenue and operating income figures would remove a key source of momentum uncertainty and could reveal a more consistently positive underlying trend.
Bearish Triggers
- If the payout ratio remains above 100% for another fiscal year, it would confirm that dividend growth is being funded by means other than net income, increasing the risk of a future dividend cut.
- Continued contraction in diluted EPS beyond the -11.2% decline already recorded in FY2025 would signal a structural profitability problem rather than a one-time event.
Risk Profile
Low RiskPrologis carries a Low risk rating, supported by a debt-to-equity ratio of 0.66 and interest coverage of 4.3x against a total asset base of nearly $98.7 billion. However, the sharp swing to negative revenue and operating income in 2025Q4 introduces a note of caution around near-term earnings predictability.
This report is for educational and research purposes only. It does not constitute financial, investment, legal, or tax advice — always conduct your own due diligence before making investment decisions.