Reviewing Iron Mountain (IRM) & Life Storage (LSI)

Iron Mountain (NYSE:IRM) and Life Storage (NYSE:LSI) are both mid-cap finance companies, but which is the better business? We will compare the two businesses based on the strength of their analyst recommendations, valuation, profitability, risk, dividends, earnings and institutional ownership.

Insider & Institutional Ownership

88.5% of Iron Mountain shares are held by institutional investors. Comparatively, 96.7% of Life Storage shares are held by institutional investors. 1.9% of Iron Mountain shares are held by company insiders. Comparatively, 0.8% of Life Storage shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Risk & Volatility

Iron Mountain has a beta of 0.63, indicating that its stock price is 37% less volatile than the S&P 500. Comparatively, Life Storage has a beta of 0.44, indicating that its stock price is 56% less volatile than the S&P 500.

Earnings and Valuation

This table compares Iron Mountain and Life Storage’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Iron Mountain $4.23 billion 2.16 $363.35 million $2.30 13.82
Life Storage $550.85 million 8.07 $206.59 million $5.51 17.31

Iron Mountain has higher revenue and earnings than Life Storage. Iron Mountain is trading at a lower price-to-earnings ratio than Life Storage, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Iron Mountain and Life Storage’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Iron Mountain 8.22% 19.61% 3.05%
Life Storage 37.37% 10.17% 5.30%

Analyst Recommendations

This is a summary of current ratings and target prices for Iron Mountain and Life Storage, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Iron Mountain 2 4 1 0 1.86
Life Storage 2 4 0 0 1.67

Iron Mountain currently has a consensus target price of $35.00, suggesting a potential upside of 10.10%. Life Storage has a consensus target price of $95.33, suggesting a potential downside of 0.04%. Given Iron Mountain’s stronger consensus rating and higher possible upside, equities analysts plainly believe Iron Mountain is more favorable than Life Storage.

Dividends

Iron Mountain pays an annual dividend of $2.44 per share and has a dividend yield of 7.7%. Life Storage pays an annual dividend of $4.00 per share and has a dividend yield of 4.2%. Iron Mountain pays out 106.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Life Storage pays out 72.6% of its earnings in the form of a dividend. Iron Mountain has increased its dividend for 9 consecutive years and Life Storage has increased its dividend for 2 consecutive years. Iron Mountain is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Iron Mountain beats Life Storage on 10 of the 17 factors compared between the two stocks.

About Iron Mountain

Iron Mountain Incorporated (NYSE: IRM), founded in 1951, is the global leader for storage and information management services. Trusted by more than 225,000 organizations around the world, and with a real estate network of more than 85 million square feet across more than 1,400 facilities in approximately 50 countries, Iron Mountain stores and protects billions of valued assets, including critical business information, highly sensitive data, and cultural and historical artifacts. Providing solutions that include information management, digital transformation, secure storage, secure destruction, as well as data centers, cloud services and art storage and logistics, Iron Mountain helps customers lower cost and risk, comply with regulations, recover from disaster, and enable a more digital way of working.

About Life Storage

Life Storage, Inc. is a self-administered and self-managed equity REIT that is in the business of acquiring and managing self storage facilities. Located in Buffalo, New York, the Company operates more than 750 storage facilities in 28 states and Ontario, Canada. The Company serves both residential and commercial storage customers with storage units rented by month. Life Storage consistently provides responsive service to its 400,000-plus customers, making it a leader in the industry.

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