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Iron Mountain (IRM) Beats Q1 FFO Estimates, Hikes '21 View

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Iron Mountain Incorporated IRM has reported first-quarter 2021 adjusted funds from operations (AFFO) per share of 81 cents, which surpassed the Zacks Consensus Estimate of 64 cents. Also, the reported figure was 2% higher than the year-ago quarter’s 80 cents.

The company expanded its global organic volume by 2 million cubic feet from fourth-quarter 2020, whereas it leased 9 megawatts of capacity at its global data center portfolio. Moreover, it achieved a record-level of quarterly revenues in the first quarter. However, the service segment’s performance was disappointing.

Revenues of $1.08 billion inched up 1% year over year. Also, the top line outpaced the Zacks Consensus Estimate of $1.06 billion.

Quarter in Detail

Storage rental revenues were $708 million in the first quarter, highlighting a 4% year-over-year increase.

Service revenues amounted to $374 million in the reported quarter, indicating a year-over-year fall of 3%.

Adjusted EBITDA improved 4% year over year to $381 million in first-quarter 2021. Moreover, adjusted EBITDA margin expanded 100 basis points (bps) to 35.2% on a year-over-year basis, backed by benefits from Project Summit and the flow-through from revenue management.

Liquidity

The company exited the first quarter with $138.9 million of cash and cash equivalents, down from $205 million at the end of 2020.

Dividend Update

On May 6, Iron Mountain announced its second-quarter common stock cash dividend of 61.85 cents per share. The dividend will be paid out on Jul 6, 2021, to its shareholders of record at the close of business on Jun 15, 2021.

Project Summit Update

Iron Mountain’s transformation program, Project Summit, focuses on simplifying its global structure, streamlining managerial structure and enhancing its customer experience.

Project Summit is anticipated to deliver annual adjusted EBITDA benefits of $375 million exiting 2021.

Outlook

Iron Mountain increased the guidance for 2021 and expects current-year AFFO per share of $3.28-$3.45 compared with $3.25-$3.42 mentioned earlier. The Zacks Consensus Estimate for the same is pegged at $2.66.

Revenues are projected to be $4,365-$4,515 million, up from $4,325-$4,475 million mentioned earlier. Adjusted EBITDA is predicted to be $1,585-$1,635 million, rising from $1,575-$1,625 million stated previously.

Iron Mountain Incorporated Price, Consensus and EPS Surprise

Iron Mountain Incorporated Price, Consensus and EPS Surprise
Iron Mountain Incorporated Price, Consensus and EPS Surprise

Iron Mountain Incorporated price-consensus-eps-surprise-chart | Iron Mountain Incorporated Quote

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.

Performance of Other REITs

PS Business Parks, Inc. PSB reported first-quarter 2021 core FFO per share of $1.67, in line with the Zacks Consensus Estimate. However, the reported figure decreased 2.9% year over year.

Boston Properties Inc.’s BXP first-quarter 2021 FFO per share of $1.56 beat the Zacks Consensus Estimate of $1.55. The quarterly figure also surpassed the mid-point of the company’s guidance by a cent, highlighting better-than-projected portfolio performance and higher fee income.

Highwoods Properties, Inc.’s HIW first-quarter 2021 FFO per share of 91 cents surpassed the Zacks Consensus Estimate of 87 cents. However, FFO per share declined 2.2% from 91 cents recorded in the year-ago period.

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.

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Iron Mountain Incorporated (IRM) : Free Stock Analysis Report

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