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Key Takeaways Iron Mountain's recurring storage revenues and pricing supported strong first-quarter 2026 growth. IRM's data center revenues jumped 47.1% as leasing stayed strong and utilization remained high.IRM grew digital and asset lifecycle businesses over 50% year over year, boosting service revenues. Iron Mountain Incorporated (IRM - Free Report) shares have rallied 30.2% in the past three months compared with the industry’s growth of 10.2%.

Iron Mountain’s recurring storage rental revenues remain resilient through pricing and strong retention, while rapid data center expansion, robust leasing demand, and growing digital and asset lifecycle management businesses continue to drive growth and diversify revenues beyond traditional records storage.

Analysts seem bullish on this Zacks Rank #3 (Hold) stock. The Zacks Consensus Estimate for its 2026 AFFO per share has been revised northward by 13 cents to $5.85 over the past two months.

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Factors Behind IRM Stock’s Price SurgeIron Mountain continues to rely on highly recurring storage rental revenues, supported by pricing, revenue management and strong customer retention. In the first quarter of 2026, consolidated storage rental revenues increased 15.4% year over year, while Global RIM storage rental grew 8.7%. These results indicate that pricing and revenue management continue to help offset gradual declines in physical storage volumes. Management also highlighted that the physical records storage business delivered its best quarterly growth in years, helping fund investment in faster-growing offerings.

The Global Data Center business remains Iron Mountain's primary growth engine, benefiting from sustained enterprise and hyperscale demand for secure, interconnected capacity. In the first quarter of 2026, data center revenues increased 47.1% year over year to $254.7 million, driven primarily by 46% increase in storage rental revenues, while adjusted EBITDA margin remained above 50% at 52.1%. The operating portfolio reached 507.2 megawatt (MW) from 424.2 MW a year ago and was 97.2% leased, reflecting strong utilization. Leasing activity remained healthy, with 21,849 kilowatt (KW) of new and expansion leases signed during the quarter.

Management reported 32 MW of data center leasing from the beginning of the year through April 2026, suggesting demand carried into the early second quarter. Churn remained low at 0.4%, while cash mark-to-market was 12%, pointing to pricing power on renewals. The development pipeline also expanded, with 181.5 MW under construction and 684.2 MW held for future development, bringing total potential data center capacity to 1.37 gigawatt (GW). This robust pipeline supports the company’s strategy to build and energize capacity ahead of demand and sustain high growth rates as more sites come online.

Iron Mountain is broadening beyond traditional records storage through digital and asset lifecycle management capabilities that management is increasingly cross-selling across its large customer base. Management said that the data center, digital and ALM businesses grew more than 50% year over year in first-quarter 2026, while consolidated service revenues rose 30.6% year over year to $841 million.

Within Global RIM, service revenues increased 16.5% year over year, indicating healthy demand for higher-value services alongside storage. Recent acquisitions in IT asset disposition and logistics capabilities extend the lifecycle offering set and deepen customer relationships, which can improve wallet share over time, even as paper-based workflows evolve. The company’s global footprint and broad customer mix also help scale these newer offerings across regions and industries.

Key Concerns for Iron MountainCompetition from other industry players is likely to lead to aggressive pricing pressure and hurt Iron Mountain’s prospects. High interest expenses and adverse foreign currency movements remain a concern.

Stocks to ConsiderSome better-ranked stocks from the broader REIT sector are Lamar Advertising (LAMR - Free Report) and Vornado Realty Trust (VNO - Free Report) , each carrying a Zacks Rank of 2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for LAMR’s 2026 FFO per share is pegged at $8.81, which indicates year-over-year growth of 6.66%.

The Zacks Consensus Estimate for VNO’s full-year FFO per share is pinned at $2.34, which calls for an increase of 0.86% from the year-ago period.

Note: Anything related to earnings presented in this write-up represents FFO, a widely used metric to gauge the performance of REITs.