Does Iron Mountain’s Cloud Expansion Signal More Room for Growth in 2025?

If you hold shares of Iron Mountain or are considering a buy, you are not alone in wondering whether this resilient storage and data management giant is still a good value. Over the past five years, Iron Mountain’s stock has surged an impressive 384.8%, outpacing many of its peers and steadily rewarding patient investors. Even with a recent one-year dip of 9.9%, the company’s long-term momentum continues to grab attention, especially after notching a 3.7% gain this past week and climbing nearly 11% over the last month.

Many in the market are starting to take note of the shift in risk sentiment around Iron Mountain, as ongoing demand for secure data storage and new market developments hint at continued growth potential. Yet, with all these moves, it’s natural to wonder if the valuation still stacks up. Based on six different valuation checks commonly used to assess whether a company is undervalued, Iron Mountain scores a solid 5 out of 6, underscoring its potential appeal at current prices.

So, how do these valuation checks work, and what do they reveal about Iron Mountain? Let’s break down the methods behind these scores. After that, I’ll show you an even sharper way to look at valuation that could give you the investing edge.

Iron Mountain delivered -9.9% returns over the last year. See how this stacks up to the rest of the Specialized REITs industry.

Approach 1: Iron Mountain Discounted Cash Flow (DCF) Analysis

The Discounted Cash Flow (DCF) model estimates a company’s worth by projecting its future cash flows, in this case, Iron Mountain’s adjusted funds from operations, and discounting those amounts back to today. This approach helps determine what the company is really worth based on how much cash it is expected to generate in the coming years.

Iron Mountain’s most recent Free Cash Flow stands at $1.34 billion. Analysts offer explicit forecasts for the next five years, projecting significant growth ahead, with future Free Cash Flow expected to reach $2.26 billion by the end of 2029. After these analyst-backed years, further yearly projections are extrapolated based on observable trends and expert modeling, resulting in a total 10-year cash flow outlook. All figures are reported in US dollars.

From this analysis, Iron Mountain's estimated intrinsic value comes out to $158.97 per share. With the DCF model showing the stock is trading at a 34.5% discount to that fair value, it points to Iron Mountain currently being undervalued by a substantial margin.

Result: UNDERVALUED

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Iron Mountain.

Our Discounted Cash Flow (DCF) analysis suggests Iron Mountain is undervalued by 34.5%. Track this in your watchlist or portfolio, or discover more undervalued stocks.

Approach 2: Iron Mountain Price vs Sales

The Price-to-Sales (P/S) ratio is a widely used valuation metric for companies like Iron Mountain, especially among those with steady revenues and robust market positions. This multiple lets investors see how much they are paying for each dollar of sales, providing a useful way to compare value across businesses regardless of differences in profit margins. For profitable and growing companies, a reasonable P/S ratio can offer insight into future growth potential as well as market risk appetite for the company’s business model.

Broadly, growth expectations and risk strongly influence what counts as a “normal” or “fair” P/S ratio. Fast-growing or lower-risk companies are typically rewarded with higher ratios, as investors are willing to pay up for their prospects. Conversely, slow-growth or riskier businesses usually see lower P/S multiples. Looking at Iron Mountain, the stock currently trades at a P/S ratio of 4.77x. That sits comfortably below both the industry average of 8.34x and the peer average of 11.87x. This suggests the market is pricing Iron Mountain more cautiously than many of its competitors.

Simply Wall St’s proprietary “Fair Ratio” model delivers an even sharper lens for valuation. Unlike simple peer or industry comparisons, the Fair Ratio (5.77x for Iron Mountain) is tailored to reflect the company’s specific blend of growth outlook, profit margins, risk factors, market capitalization, and industry benchmark. This approach aims to provide a more precise sense of what the stock should be worth in today’s market and goes beyond broad averages to better match reality.

Comparing the Fair Ratio of 5.77x with Iron Mountain’s current P/S ratio of 4.77x, the shares appear to be trading below their modeled fair value. This supports the view that the stock is currently undervalued by this measure as well.

Result: UNDERVALUED

PS ratios tell one story, but what if the real opportunity lies elsewhere? Discover companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Iron Mountain Narrative

Earlier, we mentioned there is an even better way to understand valuation, so let’s introduce you to Narratives. Narratives are simple yet powerful tools. They let you put your story behind the numbers by outlining your expectations for Iron Mountain’s future revenue, earnings, and profit margins, which then drives your view of fair value.

Unlike traditional models, Narratives connect what you believe about a company’s journey with its financial forecasts and help calculate a fair price. This turns dry valuations into a living, dynamic picture. On Simply Wall St’s Community page, millions of investors are already building Narratives. It’s as easy as updating your assumptions and you get instant feedback on what your view implies about whether to buy, hold, or sell.

Narratives update automatically as news or results come in, so your assessment can keep pace with the market, rather than getting left behind. For example, recently, one Iron Mountain Narrative forecasted rapid data center-driven growth and set fair value at $140, while another expected declining legacy business and set theirs at just $44. This demonstrates a wide range of perspectives, all linked to actual numbers and market context.

Do you think there's more to the story for Iron Mountain? Create your own Narrative to let the Community know!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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