Prologis (PLD) Stock Gains Today on $5.9 Billion Acquisition of KTR Partners

NEW YORK (TheStreet) -- Prologis announced that it signed a definitive agreement to acquire KTR Partners for $5.9 billion through its joint venture with Norges Bank Investment Management, Prologis U.S. Logistics Venture.Prologis, the world's largest owner of industrial real estate, said that the deal expands its position in Southern California, New Jersey, Chicago, South Florida, Seattle and Dallas, and forecast that the acquisition will add about $0.14 per share to its annual core funds from operations."It is rare to have the opportunity to acquire a portfolio of such high asset quality, customer profile and market composition that is so consistent with our own," said CEO Hamid Moghadam. "This transaction will deliver accretive returns to our shareholders and will enhance our important and successful partnership with NBIM, which will now exceed $11 billion on two continents."U.S. industrial real estate prices have risen 17% over the past year, according to Bloomberg, and are within 2% of the their 2007 peak.Prologis shares are up 0.28% to $43 in early market trading today. TheStreet Ratings team rates PROLOGIS INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation: "We rate PROLOGIS INC (PLD) a BUY. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its increase in stock price during the past year, compelling growth in net income, revenue growth, good cash flow from operations and expanding profit margins. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results." Highlights from the analysis by TheStreet Ratings Team goes as follows: This stock has managed to rise its share value by 5.06% over the past twelve months. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year. The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Real Estate Investment Trusts (REITs) industry. The net income increased by 570.5% when compared to the same quarter one year prior, rising from $61.19 million to $410.29 million. Despite its growing revenue, the company underperformed as compared with the industry average of 10.1%. Since the same quarter one year prior, revenues slightly increased by 6.7%. Growth in the company's revenue appears to have helped boost the earnings per share. Net operating cash flow has significantly increased by 66.12% to $253.74 million when compared to the same quarter last year. In addition, PROLOGIS INC has also vastly surpassed the industry average cash flow growth rate of 12.85%. PROLOGIS INC has shown improvement in its earnings for its most recently reported quarter when compared with the same quarter a year earlier. The company has demonstrated a pattern of positive earnings per share growth over the past two years. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, PROLOGIS INC increased its bottom line by earning $1.18 versus $0.42 in the prior year. For the next year, the market is expecting a contraction of 47.9% in earnings ($0.62 versus $1.18). You can view the full analysis from the report here: PLD Ratings Report Must Read: Warren Buffett's Top 25 Stocks for 2015

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