Prologis (PLD) shares soared 6.1% in the last trading session to close at $137.12. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 17% gain over the past four weeks.
After 11 interest rate hikes, the Fed's decision to pause rate hikes for the third month drove bullish sentiments across markets amid the optimism of easing inflation pressures. With this, the interest rates remain at a 22-year high of 5.25-5.5%. Further, the central bank indicated three interest rate cuts by 2024-end. These developments turned investor sentiment bullish on REIT stocks, as low rates are likely to make REITs funding cost more affordable. Hence, the PLD stock gained.
This industrial real estate developer is expected to post quarterly earnings of $1.26 per share in its upcoming report, which represents a year-over-year change of +1.6%. Revenues are expected to be $1.78 billion, up 12.2% from the year-ago quarter.
While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For Prologis, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on PLD going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Prologis belongs to the Zacks REIT and Equity Trust - Other industry. Another stock from the same industry, Healthpeak (PEAK), closed the last trading session 4.9% higher at $20.12. Over the past month, PEAK has returned 13.2%.
Healthpeak's consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.45. Compared to the company's year-ago EPS, this represents a change of +2.3%. Healthpeak currently boasts a Zacks Rank of #3 (Hold).
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