The Gory Details on Iron Mountain's Double Fumble

Seth Jayson, The Motley Fool
Updated

Iron Mountain (NYS: IRM) reported earnings on Oct. 31. Here are the numbers you need to know.

The 10-second takeaway
 For the quarter ended Sep. 30 (Q3), Iron Mountain missed estimates on revenues and missed estimates on earnings per share.

Compared to the prior-year quarter, revenue shrank and GAAP earnings per share increased significantly.


Gross margins shrank, operating margins dropped, net margins expanded.

Revenue details
 Iron Mountain reported revenue of $748.1 million. The nine analysts polled by S&P Capital IQ looked for net sales of $763.7 million on the same basis. GAAP reported sales were 3.1% lower than the prior-year quarter's $772.1 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
 EPS came in at $0.34. The 13 earnings estimates compiled by S&P Capital IQ predicted $0.35 per share. GAAP EPS of $0.31 for Q3 were 63% higher than the prior-year quarter's $0.19 per share. (The prior-year quarter included $0.02 per share in earnings from discontinued operations.)

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
 For the quarter, gross margin was 58.5%, 90 basis points worse than the prior-year quarter. Operating margin was 20.4%, 170 basis points worse than the prior-year quarter. Net margin was 7.1%, 230 basis points better than the prior-year quarter.

Looking ahead
 Next quarter's average estimate for revenue is $748.2 million. On the bottom line, the average EPS estimate is $0.30.

Next year's average estimate for revenue is $3.01 billion. The average EPS estimate is $1.31.

Investor sentiment
 The stock has a four-star rating (out of five) at Motley Fool CAPS, with 279 members out of 304 rating the stock outperform, and 25 members rating it underperform. Among 116 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 106 give Iron Mountain a green thumbs-up, and 10 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Iron Mountain is outperform, with an average price target of $38.86.

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The article The Gory Details on Iron Mountain's Double Fumble originally appeared on Fool.com.

Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no positions in the stocks mentioned above. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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