Critical Analysis: Iron Mountain (IRM) vs. Tangoe (TNGO)

Iron Mountain (NYSE: IRM) and Tangoe (NASDAQ:TNGO) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their earnings, dividends, profitability, institutional ownership, analyst recommendations, risk and valuation.

Insider & Institutional Ownership

86.0% of Iron Mountain shares are held by institutional investors. Comparatively, 59.2% of Tangoe shares are held by institutional investors. 1.5% of Iron Mountain shares are held by company insiders. Comparatively, 12.0% of Tangoe shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares Iron Mountain and Tangoe’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Iron Mountain $3.77 billion 2.60 $1.21 billion $0.74 50.18
Tangoe N/A N/A N/A N/A N/A

Iron Mountain has higher revenue and earnings than Tangoe.

Profitability

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

Net Margins Return on Equity Return on Assets
Iron Mountain 5.14% 14.46% 2.92%
Tangoe -7.96% -9.86% -7.97%

Analyst Recommendations

This is a breakdown of current ratings and price targets for Iron Mountain and Tangoe, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Iron Mountain 1 0 1 0 2.00
Tangoe 0 1 0 0 2.00

Iron Mountain presently has a consensus price target of $35.00, suggesting a potential downside of 5.74%. Tangoe has a consensus price target of $6.50, suggesting a potential upside of 2.36%. Given Tangoe’s higher probable upside, analysts clearly believe Tangoe is more favorable than Iron Mountain.

Volatility and Risk

Iron Mountain has a beta of 0.94, indicating that its share price is 6% less volatile than the S&P 500. Comparatively, Tangoe has a beta of 1.04, indicating that its share price is 4% more volatile than the S&P 500.

Dividends

Iron Mountain pays an annual dividend of $2.20 per share and has a dividend yield of 5.9%. Tangoe does not pay a dividend. Iron Mountain pays out 297.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Iron Mountain has raised its dividend for 7 consecutive years.

Summary

Iron Mountain beats Tangoe on 8 of the 12 factors compared between the two stocks.

Iron Mountain Company Profile

Iron Mountain Incorporated (Iron Mountain) is engaged in storing records, primarily paper documents and data backup media, and provide information management services. The Company offers records management services, data protection and recovery services and information destruction services. Its information management services are divided into three categories: records management services, data protection and recovery services, and information destruction services. The Company’s records management services include flexible retrieval access, retention management and records management program development and implementation based on practices to help customers comply with specific regulatory requirements and policy-based programs. It provides data protection and recovery services for both physical and electronic records. The Company’s information destruction services consist primarily of physical secure shredding operations.

Tangoe Company Profile

Tangoe, Inc. is a provider of information technology (IT) and Telecom Expense Management (TEM) software and related services. The Company offers its services to a range of global enterprises and service providers. Its products and solutions include mobility, telecom, cloud, IT expense, strategic consulting and mobility as a service (MaaS). Its mobility solution includes expense management; procurement, logistics and activation; usage management; enterprise mobility; mobile support, and financial management. Its IT expense solution includes expense management, inventory and asset management, usage management and financial management. Its enterprise mobility and IT consulting services include strategic sourcing; strategy assessment, planning, and policy development, and implementation and transition support. The Company offers contract sourcing, strategy and policy consulting, service maturity assessment, global services benchmarking and lifecycle advisory, among others.

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