BMO upgrades Prologis to Outperform on data center exposure

BMO Capital upgraded Prologis (PLD) to Outperform from Market Perform with a price target of $162, up from $137. The company has “considerable ability” to benefit from data center demand, both as a developer and industrial landlord, the analyst tells investors in a research note. The firm says data center suppliers represent 10% of Prologis’ new leasing and the largest segment of the “flourishing” manufacturing leasing market in Q1. BMO’s channel checks suggest a recovery is “finally evident” for class A industrial space in Los Angeles, the company’s largest market. As such, the firm expects Prologis’ earnings growth to accelerate.