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Iron Mountain's Q3 AFFO Beat Estimates, Revenues Rise Y/Y
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Iron Mountain Incorporated (IRM - Free Report) reported third-quarter 2024 adjusted funds from operations (AFFO) per share of $1.13, beating the Zacks Consensus Estimate of $1.11.
Results reflect solid performances in the storage and service segments and the data center business. However, higher interest expenses in the quarter acted as a dampener. The company reaffirmed its outlook for 2024.
Quarterly total revenues of $1.56 billion surpassed the Zacks Consensus Estimate by just 0.06%.
On a year-over-year basis, AFFO per share and total revenues increased 10.8% and 12.2%, respectively.
According to William L. Meaney, president and CEO of Iron Mountain, “We are pleased to report a very strong third quarter and continued strong momentum in the second half of 2024, resulting in all-time record Revenue, Adjusted EBITDA, and AFFO.”
Behind the Headlines
Storage rental revenues were $935.7 million in the third quarter, up 9% year over year. We had estimated quarterly storage rental revenues to be $935.6 million.
Service revenues increased 17.4% from the prior-year quarter to $621.7 million.
The Global Data Center business reported revenues of $153.2 million in the third quarter, rising 20.1% year over year. Our estimate was pegged at $156 million.
The adjusted EBITDA rose 13.6% year over year to $568.1 million. The adjusted EBITDA margin came at 36.5%, increasing 50 basis points year over year.
However, interest expenses flared up 21.8% year over year to $186.1 million in the quarter. We projected the metric to be $178 million.
Balance-Sheet Position
IRM exited the third quarter with $168.5 million of cash and cash equivalents, up from $144.3 million as of June 30, 2024.
Dividend Update
Concurrently, IRM announced a quarterly cash dividend of 71.5 cents per share for the fourth quarter of 2024. The dividend will be paid out on Jan. 7, 2024, to its shareholders on record as of Dec. 16, 2024.
2024 Guidance
Iron Mountain reaffirmed its guidance for 2024 and now expects to be on track to achieve the upper end of the 2024 guidance range.
It expects AFFO per share of $4.39-$4.51. The Zacks Consensus Estimate for the same is pegged at $4.49, which lies within the company’s guided range.
Revenues are estimated to be $6.00-$6.15 billion, while adjusted EBITDA is anticipated to be $2.175-$2.225 billion.
Prologis, Inc. (PLD - Free Report) reported third-quarter 2024 core funds from operations (FFO) per share of $1.43, outpacing the Zacks Consensus Estimate of $1.37. This compares favorably with the year-ago quarter’s figure of $1.30.
The quarterly results reflected a rise in rental revenues and healthy leasing activity. However, high interest expenses are an undermining factor. In addition, PLD increased its 2024 core FFO per share guidance range.
Crown Castle Inc. (CCI - Free Report) reported third-quarter 2024 AFFO per share of $1.84, outpacing the Zacks Consensus Estimate of $1.80. The reported figure also increased by 4% from the year-ago quarter.
Results reflected a rise in site rental revenues and a decline in total operating expenses year over year. However, a decrease in services and other revenues affected the results to some extent. CCI maintained its outlook for 2024.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs.
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Iron Mountain's Q3 AFFO Beat Estimates, Revenues Rise Y/Y
Iron Mountain Incorporated (IRM - Free Report) reported third-quarter 2024 adjusted funds from operations (AFFO) per share of $1.13, beating the Zacks Consensus Estimate of $1.11.
Results reflect solid performances in the storage and service segments and the data center business. However, higher interest expenses in the quarter acted as a dampener. The company reaffirmed its outlook for 2024.
Quarterly total revenues of $1.56 billion surpassed the Zacks Consensus Estimate by just 0.06%.
On a year-over-year basis, AFFO per share and total revenues increased 10.8% and 12.2%, respectively.
According to William L. Meaney, president and CEO of Iron Mountain, “We are pleased to report a very strong third quarter and continued strong momentum in the second half of 2024, resulting in all-time record Revenue, Adjusted EBITDA, and AFFO.”
Behind the Headlines
Storage rental revenues were $935.7 million in the third quarter, up 9% year over year. We had estimated quarterly storage rental revenues to be $935.6 million.
Service revenues increased 17.4% from the prior-year quarter to $621.7 million.
The Global Data Center business reported revenues of $153.2 million in the third quarter, rising 20.1% year over year. Our estimate was pegged at $156 million.
The adjusted EBITDA rose 13.6% year over year to $568.1 million. The adjusted EBITDA margin came at 36.5%, increasing 50 basis points year over year.
However, interest expenses flared up 21.8% year over year to $186.1 million in the quarter. We projected the metric to be $178 million.
Balance-Sheet Position
IRM exited the third quarter with $168.5 million of cash and cash equivalents, up from $144.3 million as of June 30, 2024.
Dividend Update
Concurrently, IRM announced a quarterly cash dividend of 71.5 cents per share for the fourth quarter of 2024. The dividend will be paid out on Jan. 7, 2024, to its shareholders on record as of Dec. 16, 2024.
2024 Guidance
Iron Mountain reaffirmed its guidance for 2024 and now expects to be on track to achieve the upper end of the 2024 guidance range.
It expects AFFO per share of $4.39-$4.51. The Zacks Consensus Estimate for the same is pegged at $4.49, which lies within the company’s guided range.
Revenues are estimated to be $6.00-$6.15 billion, while adjusted EBITDA is anticipated to be $2.175-$2.225 billion.
Iron Mountain currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Iron Mountain Incorporated Price, Consensus and EPS Surprise
Iron Mountain Incorporated price-consensus-eps-surprise-chart | Iron Mountain Incorporated Quote
Performance of Other REITs
Prologis, Inc. (PLD - Free Report) reported third-quarter 2024 core funds from operations (FFO) per share of $1.43, outpacing the Zacks Consensus Estimate of $1.37. This compares favorably with the year-ago quarter’s figure of $1.30.
The quarterly results reflected a rise in rental revenues and healthy leasing activity. However, high interest expenses are an undermining factor. In addition, PLD increased its 2024 core FFO per share guidance range.
Crown Castle Inc. (CCI - Free Report) reported third-quarter 2024 AFFO per share of $1.84, outpacing the Zacks Consensus Estimate of $1.80. The reported figure also increased by 4% from the year-ago quarter.
Results reflected a rise in site rental revenues and a decline in total operating expenses year over year. However, a decrease in services and other revenues affected the results to some extent. CCI maintained its outlook for 2024.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs.