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    Did Iron Mountain’s AI-Fueled Data Center Surge and Volatility Spike Just Shift IRM’s Investment Narrative?

    Simply Wall St·12/09/2025 19:16:43
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    • Recently, Iron Mountain reported that its data center segment is expanding rapidly to serve artificial intelligence demand, guiding for data center revenue growth above 30% in Q4 and more than 25% in 2026 while also raising its upcoming dividend.
    • At the same time, unusually high implied volatility in the January 16, 2026 US$47.50 call options suggests investors are positioning for a substantial move in the stock, reflecting heightened attention on the company’s shift toward higher-growth digital infrastructure.
    • We’ll now examine how Iron Mountain’s accelerating AI-driven data center growth could reshape its investment narrative and long-term growth profile.

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    Iron Mountain Investment Narrative Recap

    To own Iron Mountain, you need to believe its pivot from paper-based storage to AI-ready data centers can offset pressure on its legacy business and support its high debt and dividend load. The latest guidance for data center revenue growth and the surge in options volatility both sharpen the near term focus on execution in digital infrastructure, while elevated leverage and capital needs remain the key risk that this story does not fully play out.

    The recent dividend increase to US$0.864 per share, payable in early January, ties directly into this debate, because it reinforces Iron Mountain’s income appeal just as it steps up capital-intensive data center expansion. That combination makes the strength and timing of AI-driven data center demand a central catalyst for how comfortably the company can fund both growth and distributions from cash flows rather than relying heavily on new borrowing.

    Yet investors should also be aware that Iron Mountain’s heavier dependence on data center build outs could expose them to infrastructure overbuild and rising competition risks if ...

    Read the full narrative on Iron Mountain (it's free!)

    Iron Mountain's narrative projects $8.3 billion revenue and $775.8 million earnings by 2028.

    Uncover how Iron Mountain's forecasts yield a $116.73 fair value, a 38% upside to its current price.

    Exploring Other Perspectives

    IRM 1-Year Stock Price Chart
    IRM 1-Year Stock Price Chart

    Six Simply Wall St Community valuations for Iron Mountain span roughly US$94.95 to US$216.50 per share, showing how far apart individual views can be. Before you lean toward any one camp, consider how reliant the current story is on aggressive data center expansion and what that might mean for future returns if conditions shift.

    Explore 6 other fair value estimates on Iron Mountain - why the stock might be worth just $94.95!

    Build Your Own Iron Mountain Narrative

    Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

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    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.