What does free cash flow margin mean?

How much real, spendable cash each sales dollar generates after reinvestment.

How do you interpret free cash flow margin?

A high and rising FCF margin is the hallmark of a cash-generative business. Persistent gaps between net margin and FCF margin warrant a look at working capital or capital intensity.

How does free cash flow margin compare across companies?

Strong cross-company quality signal; capital-light compounders post structurally higher FCF margins than asset-heavy peers.

Prologis PLD Free cash flow margin

Discontinued — last reported Q2 '19

Free cash flow margin at other companies

EastGroup PropertiesEGP

56.7%+0.8pp

First Industrial Realty TrustFR

53.1%+6.9pp

BlackstoneBX

29.9%+2.1pp

Realty IncomeO

66.7%+2.7pp

CoStar GroupCSGP

6.9%—

Invitation HomesINVH

43.2%+3.0pp

Other financials

Income statement

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Revenue$2.2B+8.7%

Operating income$940.3M-24.8%

Net income$764.3M-24.0%

EPS (diluted)$0.82-24.1%

Balance sheet

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Cash & equivalents$1.2B+51.9%

Total debt$35.9B+9.1%

Total equity$52.6B-0.8%

Total assets$98.3B+2.5%

Cash flow

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Operating cash flow$1.4B+0.9%

Valuation

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Market cap$131.03B-9.1%

Enterprise value$165.77B-5.4%

P/E40.1×-6.0×

P/S15×-3.3×

Profitability

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Operating margin47.5%-1.0pp

Net margin37.4%-2.2pp

Returns & leverage

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Return on equity6.2%+0.3pp

Debt / equity0.7×+0.1×

Where this comes from

Calculated from Prologis’s reported figures.

free cash flow/total revenue=63.3%

Based on trailing twelve months.

The official record: Prologis’s 10-Q, filed July 28, 2020, on SEC EDGAR. View the filing →

Questions, answered.

What does free cash flow margin mean?: How much real, spendable cash each sales dollar generates after reinvestment.
How do you interpret free cash flow margin?: A high and rising FCF margin is the hallmark of a cash-generative business. Persistent gaps between net margin and FCF margin warrant a look at working capital or capital intensity.
How does free cash flow margin compare across companies?: Strong cross-company quality signal; capital-light compounders post structurally higher FCF margins than asset-heavy peers.