In a bid to strengthen its storage business,
Iron Mountain Inc.
) recently acquired two companies - Datastore and Data Technology
Services ("DTS"). However, financial details of the deal were not
disclosed by the company.
With the current acquisitions, Iron Mountain has expanded its
presence in the Wilmington, Milwaukee, Madison and the northern
Chicago suburbs. Moreover, the acquisitions of Datastore and DTS
gives Iron Mountain two records storage facilities in Cudahy and
Sun Prairie, and 24,000 square-foot record storage hub in
Iron Mountain has been pursuing an aggressive acquisition
strategy to supplement organic revenues from the storage
business. Iron Mountain has not only gained new customers from
these acquisitions, but has also been able to expand its
operations into new regions.
Earlier, in Dec 2012, Iron Mountain acquired three companies -
IG2 Data Security Inc., DATAPROS Storage and Staffing LLC, and
Data Backup Inc. All the three companies provide data storage and
protection. We believe that the company will continue to pursue
accretive acquisitions in this segment (both domestically and
internationally) over the long term.
Storage is an integral part of Iron Mountain's revenue
structure and contributes nearly 58% of its total revenue. In the
last concluded quarter, Iron Mountain recorded marginal growth of
1.7% year over year.
We expect Iron Mountain to drive significant growth through
acquisitions in fast-growing countries like Brazil, Russia, China
and India, which will boost its international revenue going
forward. We believe that diversification and expansion of its
business will help the company to counter sluggish growth from
the domestic and European markets over the long term.
However, tepid internal growth coupled with volatile foreign
exchange rates and a decline in recycled paper prices are
expected to partially negate the company's strong product
portfolio, increasing market share and promising international
business. Moreover, competition from the likes of
DST Systems Inc
Guidance Software Inc
) are the other headwinds going forward.
Currently, Iron Mountain has a Zacks Rank #3 (Hold).
CINTAS CORP (CTAS): Free Stock Analysis
DST SYSTEMS (DST): Free Stock Analysis Report
GUIDANCE SOFTWR (GUID): Free Stock Analysis
IRON MOUNTAIN (IRM): Free Stock Analysis
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