Iron Mountain to Post Q3 Earnings: What's in the Cards for the Stock?

Iron Mountain Incorporated IRM is slated to release third-quarter 2024 results on Nov. 6, before the opening bell. The quarterly results are likely to display year-over-year growth in revenues and funds from operations (FFO) per share.Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.In the last reported quarter, this real estate investment trust (REIT) delivered a surprise of 1.89% in terms of adjusted FFO (AFFO) per share. Results reflected solid performances in the storage and service segments and the data center business. However, higher interest expenses in the quarter acted as a dampener.Over the trailing four quarters, Iron Mountain’s FFO per share surpassed the Zacks Consensus Estimate on three occasions and missed in the remaining period, the average beat being 2.84%. The graph below depicts this surprising history:Iron Mountain Incorporated Price and EPS Surprise Iron Mountain Incorporated price-eps-surprise | Iron Mountain Incorporated QuoteFactors to Consider Ahead of IRM’s Q3 ResultsIn the third quarter, Iron Mountain is likely to have gained from its core storage and records management operations, known for their stability and resilience. The storage rental segment, which represents a significant portion of the company’s revenues, likely grew due to robust revenue management and steady volume growth.Demand for Iron Mountain’s traditional services, which include charges for core service activities and a range of related products, likely to have contributed positively to service revenue expansion.Additionally, strong market needs for connectivity, interconnection and colocation space likely spurred data center leasing activity. This growth might have bolstered the performance of Iron Mountain’s Global Data Center segment during the period.However, higher interest rates might have posed challenges. Elevated borrowing costs could limit Iron Mountain's capacity to finance new real estate acquisitions or developments, potentially tempering growth opportunities in the quarter.Projections for IRMThe Zacks Consensus Estimate for storage rental revenues is pegged at $928.99 million, suggesting an increase from $858.66 million in the year-ago period. The consensus estimate for service revenues is pegged at $626.76 million, indicating a rise from $529.52 million in the prior-year quarter.For the third quarter, IRM projected revenues and adjusted EBITDA of approximately $1.55 billion and $560 million, respectively.The consensus estimate for quarterly total revenues is pegged at $1.56 billion, suggesting an increase of 12.12% from the prior-year quarter’s reported figure.We estimate third-quarter interest expenses to rise 16.5% on a year-over-year basis.The company’s activities in the to-be-reported quarter were inadequate to garner analysts’ confidence. The Zacks Consensus Estimate for the quarterly AFFO per share has remained unrevised at $1.11 over the past month. However, the figure implies growth of 12.12% from the year-ago quarter’s reported number.For the third quarter, IRM expects AFFO per share of $1.10.Here is What Our Quantitative Model Predicts for IRM:Our proven model does not conclusively predict a surprise in terms of FFO per share for Iron Mountain this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an FFO beat, which is not the case here.Iron Mountain has an Earnings ESP of -0.54% and currently carries a Zacks Rank of 2. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.Stocks That Warrant a LookHere are two stocks from the broader REIT sector — Sun Communities, Inc. SUI and DiamondRock Hospitality Company DRH — that you may want to consider, as our model shows that these, too, have the right combination of elements to report a surprise this quarter.Sun Communities, slated to release quarterly numbers on Nov. 6, has an Earnings ESP of +0.51% and carries a Zacks Rank of 3 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.DiamondRock Hospitality, scheduled to report quarterly numbers on Nov. 7, has an Earnings ESP of +1.01% and carries a Zacks Rank of 3.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.Research Chief Names "Single Best Pick to Double"From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Iron Mountain Incorporated (IRM): Free Stock Analysis Report DiamondRock Hospitality Company (DRH): Free Stock Analysis Report Sun Communities, Inc. (SUI): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks