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Iron Mountain Inc. (IRM)
NYSE:IRM
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Iron Mountain
(NYSE:IRM)
63Neutral
Positive Factors
Pricing Power
Iron Mountain highlighted the strong pricing power within its core Records Management business, supported by cross selling newer services.
Revenue Growth
Data center revenues are expected to see sequential and year-over-year acceleration in revenue growth into Q4 and into 2025, supported by a strong demand and pre-leased backlog deliveries.
Strategic Role
Iron Mountain's Digital Solutions play an important strategic role, with significant potential seen in its content management platform, Insight DXP.
Negative Factors
Macroeconomic Factors
Analyst views the sell-off as driven more by election-related macro flows, opening up a more attractive buying opportunity for a company that should grow AFFO/sh by at least 10% in the years ahead.
Market Conditions
The market for building new data centers is still tight, but Iron Mountain is confident in its processes and investments in site selection and supply chain management.
Iron Mountain (IRM) vs. S&P 500 (SPY)
Market Cap
$24.74B
Dividend Yield3.4%
Average Volume (3M)2.15M
Price to Earnings (P/E)138.5
Beta (1Y)1.06
Revenue Growth12.22%
EPS Growth-2.68%
CountryUS
Employees28,850
SectorReal Estate
Sector Strength79
IndustryREIT - Specialty
Share Statistics
EPS (TTM)0.61
Shares Outstanding293,740,900
10 Day Avg. Volume2,324,941
30 Day Avg. Volume2,148,405
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)4.18
Price to Cash Flow (P/CF)14.90
P/FCF Ratio221.30
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$104.60Price Target Upside28.17% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering6
Iron Mountain Business Overview & Revenue Model
Company DescriptionIron Mountain Incorporated (NYSE: IRM), founded in 1951, is the global leader for storage and information management services. Trusted by more than 225,000 organizations around the world, and with a real estate network of more than 90 million square feet across approximately 1,450 facilities in approximately 50 countries, Iron Mountain stores and protects billions of valued assets, including critical business information, highly sensitive data, and cultural and historical artifacts. Providing solutions that include secure records storage, information management, digital transformation, secure destruction, as well as data centers, cloud services and art storage and logistics, Iron Mountain helps customers lower cost and risk, comply with regulations, recover from disaster, and enable a more digital way of working.
How the Company Makes MoneyIron Mountain makes money primarily through its core services of records and information management. The company generates revenue from storing physical documents and media in its vast network of secure facilities, charging clients for space and the associated services like retrieval and transportation. Additionally, Iron Mountain offers data management solutions, including cloud services, data centers, and data protection services, which provide recurring revenue streams. Secure shredding and destruction services also contribute to the company's income, as they help clients manage confidential information disposal. The company benefits from long-term client contracts and partnerships, providing a stable revenue base. Its diversified offerings and global reach allow Iron Mountain to capitalize on the ongoing demand for both traditional and digital information management solutions.
Iron Mountain Financial Statement Overview
Summary
Iron Mountain shows robust revenue growth and operational efficiency, with a healthy EBITDA margin. However, the balance sheet indicates high leverage and negative free cash flow, raising concerns over cash management.Income Statement
Iron Mountain's revenue has shown a consistent growth trend, increasing from $4.14 billion in 2020 to $6.15 billion in 2024. The gross profit margin is strong, consistently around 50% to 60%. However, net profit margin has been relatively low due to high expenses, with recent figures showing a decrease in net income. Despite this, the company maintains a healthy EBITDA margin, indicating operational efficiency.75
Positive
Balance Sheet
The balance sheet reveals a high debt-to-equity ratio due to negative stockholders' equity, indicating high leverage. While total assets have increased, the equity ratio is negative, posing potential risks. The company's ability to manage liabilities is crucial given the substantial debt levels.55
Neutral
Cash Flow
Operating cash flow has been consistently positive, indicating strong cash-generating ability. However, free cash flow has been negative in recent years, driven by high capital expenditures. This trend poses a challenge in terms of liquidity and funding operational needs.60
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 6.15B | 5.48B | 5.10B | 4.49B | 4.15B | Gross Profit |
| 6.15B | 3.12B | 2.91B | 2.60B | 2.39B | EBIT |
| 1.01B | 921.78M | 1.05B | 854.17M | 645.10M | EBITDA |
| 1.91B | 1.62B | 1.87B | 1.75B | 1.30B | Net Income Common Stockholders |
| 180.16M | 184.23M | 556.98M | 450.22M | 342.69M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 155.72M | 222.79M | 141.80M | 255.83M | 205.06M | Total Assets |
| 18.72B | 17.47B | 16.14B | 14.45B | 14.15B | Total Debt |
| 4.42B | 14.79B | 13.29B | 11.44B | 10.75B | Net Debt |
| 4.26B | 14.56B | 13.15B | 11.19B | 10.54B | Total Liabilities |
| 18.94B | 17.08B | 15.50B | 13.59B | 13.01B | Stockholders Equity |
| -503.12M | 211.65M | 636.67M | 857.07M | 1.14B |
| Cash Flow | Free Cash Flow | |||
| -594.86M | -231.53M | 44.11M | 134.53M | 534.40M | Operating Cash Flow |
| 1.20B | 1.11B | 927.70M | 758.90M | 987.66M | Investing Cash Flow |
| -2.14B | -1.44B | -1.66B | -473.31M | -85.44M | Financing Cash Flow |
| 876.75M | 425.67M | 639.21M | -220.81M | -886.70M |
Iron Mountain Technical Analysis
Negative
81.61
Price Trends
88.07
Negative
97.92
Negative
104.17
Negative
Market Momentum
-1.63
Negative
43.76
Neutral
78.04
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IRM, the sentiment is Negative. The current price of 81.61 is below the 20-day moving average (MA) of 83.85, below the 50-day MA of 88.07, and below the 200-day MA of 104.17, indicating a bearish trend. The MACD of -1.63 indicates Negative momentum. The RSI at 43.76 is Neutral, neither overbought nor oversold. The STOCH value of 78.04 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IRM.
Iron Mountain Risk Analysis
Iron Mountain disclosed 38 risk factors in its most recent earnings report. Iron Mountain reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Iron Mountain Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $31.28B | 35.01 | 6.02% | 4.59% | 27.21% | -18.39% | |
73 Outperform | $26.71B | 25.11 | 9.36% | 3.98% | 3.80% | 24.08% | |
66 Neutral | $15.73B | 174.66 | 1.39% | 3.05% | 0.02% | -33.99% | |
63 Neutral | $24.74B | 138.46 | -35.81% | 3.40% | 12.22% | -2.68% | |
61 Neutral | $15.88B | 74.81 | 3.38% | 3.48% | 0.55% | ― | |
59 Neutral | $2.71B | 11.52 | 0.08% | 8691.97% | 5.56% | -16.56% | |
55 Neutral | $45.11B | 33.81 | -124.94% | 6.04% | -5.92% | -359.56% |
* Real Estate Sector Average
Performance Comparison
IRM
Iron Mountain
81.61
7.93
10.76%
CCI
Crown Castle
102.13
12.73
14.24%
EQR
Equity Residential
67.50
7.28
12.09%
EXR
Extra Space Storage
138.20
10.79
8.47%
SUI
Sun Communities
121.15
6.33
5.51%
CPT
Camden Property
110.81
16.13
17.04%
Iron Mountain Earnings Call Summary
Earnings Call Date: Feb 13, 2025 | % Change Since: -19.83% | Next Earnings Date: May 1, 2025
Earnings Call Sentiment Positive
The earnings call highlighted a strong financial performance with record-breaking results across several business segments, particularly in Data Center and Digital Solutions. However, there were some challenges, including a slight shortfall in leasing expectations and foreign exchange headwinds. The overall outlook remains positive, with continued growth expected in 2025.Highlights
Record-Breaking Financial Performance
For the full year 2024, revenue increased 12% to $6.1 billion, adjusted EBITDA grew 14% to $2.2 billion, and AFFO increased 11% to $1.3 billion. The fourth quarter saw revenue increase by 11%, adjusted EBITDA grow by 15%, and AFFO increase by 12%.
Strong Growth in Data Center Business
Data Center revenue grew by 25% in 2024 to a record $620 million, with leasing more than 100 megawatts for the third consecutive year, and a planned increase to 125 megawatts for 2025.
Expansion in Digital Solutions
The Digital Solutions business achieved record revenue in 2024, with significant growth in SaaS-based platforms and increasing adoption of AI and machine learning capabilities.
Asset Lifecycle Management (ALM) Growth
ALM revenue increased by 119% in 2024, with nearly 30% organic growth, bolstered by strong performance from recent acquisitions.
Increased Dividend
The Board of Directors authorized a 10% increase in the quarterly dividend, reflecting confidence in future growth.
Lowlights
Slight Shortfall in Data Center Leasing Expectations
Leasing slightly below midyear projections due to not accepting a significant opportunity in the fourth quarter to maintain pricing discipline.
Foreign Exchange Headwinds
Revenue impacted by the strengthening of the US dollar, contributing to sequential decreases in organic storage revenue.
Consumer Storage Strategy Shift
Focus on profitability led to a decrease in sequential consumer storage revenue as the company shifted its strategy towards more profitable segments.
Company Guidance
During the Iron Mountain Fourth Quarter 2024 Earnings Conference Call, the company reported robust financial performance and set optimistic guidance for 2025. For 2024, Iron Mountain achieved record revenue of $6.1 billion, a 12% increase, with adjusted EBITDA growing 14% to $2.2 billion and AFFO rising 11% to $1.3 billion. The fourth quarter alone saw revenue rise 11%, adjusted EBITDA grow by 15%, and AFFO increase by 12% compared to the previous year. Looking forward to 2025, the company projects continued strong growth, forecasting revenue between $6.65 billion and $6.8 billion, representing an 11% increase on a constant currency basis. They also anticipate adjusted EBITDA to grow 12% to 13% and AFFO to rise by 9% to 11% on a constant currency basis. The company plans to achieve this through its diversified portfolio, including data centers and digital solutions, with these growth areas now comprising 25% of total revenue. Furthermore, Iron Mountain announced a 10% increase in its quarterly dividend, reflecting confidence in sustained growth and shareholder value.Iron Mountain Corporate Events
Executive/Board Changes
Iron Mountain Appoints June Yee Felix as Director
Neutral
Dec 9, 2024
June Yee Felix, a seasoned leader in the financial services and technology sectors, has been appointed as a director of the Company effective January 1, 2025. With her impressive background as Group CEO of IG Group and roles at Citibank, IBM, and Chase Manhattan Bank, Felix brings vast experience to the Audit and Risk and Safety Committees. Her compensation will include restricted stock units under the Company’s incentive plan, enhancing her alignment with shareholder interests.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.