The Problem with Iron Mountain (IRM)
Non-GAAP REIT Stats Obscure the Fact that the Company Doesn’t Cover Its Dividend
Iron Mountain (IRM) is a favorite among REIT investors who view it as a way to earn a generous dividend yield while still enjoying participation in the cloud-driven growth of leasing data center space. IRM bulls regularly throw around the company’s 5%+ dividend yield and a coverage ratio of around 70% as reasons the company is a “no-brainer” for investors seeking safe income and growth. However, a close look under the hood reveals the fact that the company does not come close to realistically covering its dividend making it dependent on outside capital to keep its stock price from cratering.