We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Iron Mountain (IRM) Beats Q3 FFO Estimates, Hikes Dividend
Read MoreHide Full Article
Iron Mountain Incorporated (IRM - Free Report) reported third-quarter 2018 normalized funds from operations (FFO) of 55 cents per share, beating the Zacks Consensus Estimate of 54 cents. The reported figure however remained flat year over year.
Results reflect decent internal storage rental revenues and margin expansion. The company has also announced a 4% hike in its quarterly dividend per share backed by continued growth and durability of cash flows.
Adjusted FFO increased 8.8% year over year to $229 million.
Iron Mountain Incorporated Price, Consensus and EPS Surprise
Revenues of $1.06 billion beat the Zacks Consensus Estimate of $1.05 billion and improved 12.4% year over year on a constant-dollar basis, reflecting impact of the recent data-center buyouts.
Storage revenues came in at $657 million in the quarter and denoted 11.7% increase on a constant-dollar basis. Internal growth was 2.3% year over year. In developed markets, storage internal revenue growth was 0.7%. In Other International markets, storage internal revenue growth came in at 5.9% year over year.
Service revenues amounted to $404 million in the quarter, indicating an increase of 13.6% on a constant-dollar basis. Moreover, internal growth was 7.1% year over year. Service internal revenue growth in developed markets and Other International markets came in at 7.1% and 6.6%, respectively.
Adjusted EBITDA margin expanded 80 basis points (bps) to 34.3%. This year-over-year upside was driven by the robust performance in North America Records and Information management (RIM) and Global Data Center, which advanced 230 bps and 3,000 bps, respectively.
Guidance
Iron Mountain revised its guidance for 2018. On a constant-dollar basis, the company expects revenues to be up 9-11% from the previous range of 7-9% and adjusted FFO to improve 13-16% from the prior range of 5-13%.
Dividend Update
Concurrent with its earnings release, Iron Mountain announced a fourth-quarter 2018 common stock cash dividend of 61.10 cents per share, up from 58.75 cents paid earlier. The dividend will be paid on Jan 3, 2019, to shareholders of record at the close of business on Dec 17, 2018.
Our Take
Iron Mountain’s strategic acquisitions, along with diversified revenue base and a strong product portfolio, bode well for long-term growth. Also, transformation initiatives, including expansion of data center business, and continued strong performance of its storage rental business have the capability to drive its long-term growth. Nevertheless, the costs of such efforts weigh on its financials, especially as the company already has a highly leveraged balance sheet. Further, rate hike adds to its woes.
We now look forward to the earnings releases of other REITs like UDR Inc. (UDR - Free Report) , Vornado Realty Trust (VNO - Free Report) and AvalonBay Communities, Inc. (AVB - Free Report) which are slated to report their quarterly numbers on Oct 29.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
Image: Bigstock
Iron Mountain (IRM) Beats Q3 FFO Estimates, Hikes Dividend
Iron Mountain Incorporated (IRM - Free Report) reported third-quarter 2018 normalized funds from operations (FFO) of 55 cents per share, beating the Zacks Consensus Estimate of 54 cents. The reported figure however remained flat year over year.
Results reflect decent internal storage rental revenues and margin expansion. The company has also announced a 4% hike in its quarterly dividend per share backed by continued growth and durability of cash flows.
Adjusted FFO increased 8.8% year over year to $229 million.
Iron Mountain Incorporated Price, Consensus and EPS Surprise
Iron Mountain Incorporated Price, Consensus and EPS Surprise | Iron Mountain Incorporated Quote
Quarter Details
Revenues of $1.06 billion beat the Zacks Consensus Estimate of $1.05 billion and improved 12.4% year over year on a constant-dollar basis, reflecting impact of the recent data-center buyouts.
Storage revenues came in at $657 million in the quarter and denoted 11.7% increase on a constant-dollar basis. Internal growth was 2.3% year over year. In developed markets, storage internal revenue growth was 0.7%. In Other International markets, storage internal revenue growth came in at 5.9% year over year.
Service revenues amounted to $404 million in the quarter, indicating an increase of 13.6% on a constant-dollar basis. Moreover, internal growth was 7.1% year over year. Service internal revenue growth in developed markets and Other International markets came in at 7.1% and 6.6%, respectively.
Adjusted EBITDA margin expanded 80 basis points (bps) to 34.3%. This year-over-year upside was driven by the robust performance in North America Records and Information management (RIM) and Global Data Center, which advanced 230 bps and 3,000 bps, respectively.
Guidance
Iron Mountain revised its guidance for 2018. On a constant-dollar basis, the company expects revenues to be up 9-11% from the previous range of 7-9% and adjusted FFO to improve 13-16% from the prior range of 5-13%.
Dividend Update
Concurrent with its earnings release, Iron Mountain announced a fourth-quarter 2018 common stock cash dividend of 61.10 cents per share, up from 58.75 cents paid earlier. The dividend will be paid on Jan 3, 2019, to shareholders of record at the close of business on Dec 17, 2018.
Our Take
Iron Mountain’s strategic acquisitions, along with diversified revenue base and a strong product portfolio, bode well for long-term growth. Also, transformation initiatives, including expansion of data center business, and continued strong performance of its storage rental business have the capability to drive its long-term growth. Nevertheless, the costs of such efforts weigh on its financials, especially as the company already has a highly leveraged balance sheet. Further, rate hike adds to its woes.
Iron Mountain currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
We now look forward to the earnings releases of other REITs like UDR Inc. (UDR - Free Report) , Vornado Realty Trust (VNO - Free Report) and AvalonBay Communities, Inc. (AVB - Free Report) which are slated to report their quarterly numbers on Oct 29.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot trades we're targeting>>