April 11, 2025 a 07:59 pm
IRM: Dividend Analysis - Iron Mountain Incorporated
Iron Mountain Incorporated (IRM) presents a complex dividend profile, characterized by a notable current dividend yield. Despite past fluctuations in payouts, the company maintains a reputation for consistency over the years. Let's explore IRM's dividend profile in detail, assessing its sustainability and attractiveness.
📊 Overview
Iron Mountain, a prominent entity in the storage and information management sector, showcases a dividend yield of 3.21% based on its current market performance. With a dividend history spanning 16 years and a recent dividend of 2.69 USD per share, IRM demonstrates a stable commitment to shareholder returns.
| Metric | Details |
|---|---|
| Sector | Information Management |
| Dividend Yield | 3.21% |
| Current Dividend Per Share | 2.69 USD |
| Dividend History | 16 years |
| Last Cut or Suspension | None |
🗣️ Dividend History
A review of IRM’s dividend history reflects resilience, with consistent increments over a 16-year period, fostering investor confidence. Regular dividends provide a reliable income stream, contributing to the stock's appeal.
| Year | Dividend Per Share (USD) |
|---|---|
| 2025 | 0.785 |
| 2024 | 2.730 |
| 2023 | 2.537 |
| 2022 | 2.474 |
| 2021 | 2.474 |
📈 Dividend Growth
Examining IRM’s dividend growth is crucial for assessing its earnings potential and long-term viability. With modest growth rates, IRM balances reinvestment and shareholder returns.
| Time | Growth |
|---|---|
| 3 years | 3.34% |
| 5 years | 2.18% |
The average dividend growth is 2.18% over 5 years. This shows moderate but steady dividend growth.
📉 Payout Ratio
Payout ratios are crucial in evaluating dividend sustainability. IRM's EPS-based payout of 438.25% and negative FCF-based payout indicate potential challenges in covering dividends with earnings and cash flow.
| Key Figure | Ratio |
|---|---|
| EPS-based | 438.25% |
| Free cash flow-based | -121.36% |
IRM's excessively high EPS payout ratio suggests a reliance on alternative sources beyond earnings to maintain dividends, which may pose a risk if earnings falter.
✅ Cashflow & Capital Efficiency
An analysis of cashflows and capital efficiency provides insights into IRM's operational agility. Despite negative free cash flow yield, the firm exhibits strategic investment focus as seen in CAPEX-to-cash flow ratios. Evaluating historical free cash flow against yields and ratios helps appraise fiscal prudence.
| Measurement | 2024 | 2023 | 2022 |
|---|---|---|---|
| Free Cash Flow Yield | -1.93% | -1.13% | 0.30% |
| Earnings Yield | 0.58% | 0.90% | 3.84% |
| CAPEX to Operating Cash Flow | 1.50 | 1.20 | 0.95 |
| Stock-based Compensation to Revenue | 1.92% | 1.35% | 1.11% |
| Free Cash Flow / Operating Cash Flow Ratio | -49.71% | -20.79% | 4.76% |
Negative free cash flow yields highlight potential liquidity pressures, although CAPEX allocation reflects strategic growth investments. Cashflows, albeit volatile, can underpin long-term firm agility.
⚠️ Balance Sheet & Leverage Analysis
IRM's balance and leverage assessments underscore financial robustness and debt positioning. Elevated debt ratios, notably debt-to-equity, necessitate careful tracking to mitigate financial stress.
| Measurement | 2024 | 2023 | 2022 |
|---|---|---|---|
| Debt-to-Equity | -8.78 | 69.87 | 20.87 |
| Debt-to-Assets | 0.24 | 0.85 | 0.82 |
| Debt-to-Capital | 1.13 | 0.99 | 0.95 |
| Net Debt to EBITDA | 2.23 | 8.99 | 7.02 |
| Current Ratio | 0.55 | 0.78 | 0.81 |
| Quick Ratio | 0.55 | 0.78 | 0.80 |
| Financial Leverage | -37.20 | 82.56 | 25.35 |
With pronounced leverage ratios, IRM's financial obligations dictate proactive debt management to reinforce liquidity buffers and ensure long-term fiscal health.
🗣️ Fundamental Strength & Profitability
IRM's profitability metrics such as ROE, ROA, and margins offer a lens into operational efficiencies. Despite certain pressures, consistent EBIT and EBITDA margins assure profitability resilience.
| Measurement | 2024 | 2023 | 2022 |
|---|---|---|---|
| Return on Equity | -35.81% | 87.05% | 87.48% |
| Return on Assets | 0.96% | 1.05% | 3.45% |
| Net Margin | 2.93% | 3.36% | 10.91% |
| EBIT Margin | 15.95% | 15.07% | 22.10% |
| EBITDA Margin | 31.01% | 29.54% | 36.71% |
| Gross Margin | 100.00% | 56.98% | 57.11% |
| R&D to Revenue | 0.00% | 0.00% | 0.00% |
IRM’s enduring profits amidst operational challenges bolster investor sentiment, underscoring the organization's sound strategic engagements.
📈 Price Development
Dividend Scoring System
| Category | Score | Score Bar |
|---|---|---|
| Dividend Yield | 4 | |
| Dividend Stability | 3 | |
| Dividend Growth | 2 | |
| Payout Ratio | 2 | |
| Financial Stability | 2 | |
| Dividend Continuity | 4 | |
| Cashflow Coverage | 2 | |
| Balance Sheet Quality | 2 |
Total Score: 21/40
Rating
Iron Mountain Incorporated provides investors with reliable dividends, albeit with financial hurdles regarding payout sustainability and leverage ratios. The company’s fiscal strategies aim to harness long-term shareholder value which, when combined with attentive management of financial exposures, could result in improved future evaluations. Investors are advised to consider these complexities within the broader economic context before making commitments.