DLR vs IRM: Dividend Comparison
Dividend data as of
Digital Realty Trust, Inc. (DLR) and Iron Mountain Inc (IRM) are both in the Real Estate sector, making them natural rivals for dividend investors. Both stocks offer similar yields — DLR at 2.83% and IRM at 3.09%. For dividend growth, IRM leads with a 5-year CAGR of 6.8% versus DLR's 1.3%. Both stocks carry a "Safe" dividend safety rating.
Verdict
Yield Analysis
IRM yields 0.26% more than DLR. In dollar terms, DLR pays $4.88/share vs IRM's $3.07/share annually.
Dividend Growth
DLR: Dividend growth is slowing — the 3-year CAGR of 0.0% trails the 5-year rate of 1.3% and the 10-year rate of 3.7%.
IRM: Dividend growth is accelerating — the 3-year CAGR of 12.6% exceeds the 5-year rate of 6.8% and the 10-year rate of 5.4%.
Dividend Safety
DLR: The payout ratio of 1% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 0.7x.
IRM: The payout ratio of 6% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 0.2x.
Estimated Annual Dividend Income
Based on current dividend yields. Actual income may vary.
What does $10,000 buy in DLR vs IRM today?
At $180.51 per share, $10,000 buys about 55.4 shares of Digital Realty Trust, Inc. (DLR). Each share pays $4.88 per year in dividends, so the position starts out generating roughly $270 per year — about $23 a month.
At $109.98 per share, $10,000 buys about 90.9 shares of Iron Mountain Inc (IRM). Each share pays $3.07 per year in dividends, so the position starts out generating roughly $279 per year — about $23 a month.
On day one the two positions generate nearly identical income; the difference comes from what happens to each dividend afterward.
What could $10,000 of DLR or IRM income look like in 10 years?
Digital Realty Trust, Inc. (DLR) has raised its dividend about 1.3% a year over the past five years. If that pace held, the $283 per year that $10,000 generates today at the current 2.83% yield would reach $321 per year by 2036 — a 3.2% yield on the original cost.
Iron Mountain Inc (IRM) has raised its dividend about 6.8% a year over the past five years. If that pace held, the $309 per year that $10,000 generates today at the current 3.09% yield would reach $596 per year by 2036 — a 6.0% yield on the original cost.
On those trailing rates, IRM pays more in 2036: $596 versus $321 per year. The projection assumes each five-year growth rate persists and no dividends are reinvested — real payouts will differ.
When would DLR's dividend growth overtake IRM's higher yield?
It doesn't, on the trailing numbers. Iron Mountain Inc (IRM) yields more today (3.09% vs 2.83%) and has also grown its dividend at least as fast (6.8% vs 1.3% a year over five years). Unless DLR accelerates its raises or IRM stumbles, DLR never closes the income gap — IRM wins on both current income and growth.
Can DLR and IRM afford their dividends?
Digital Realty Trust, Inc. (DLR) earns $3.58 per share against $4.88 paid out in dividends — 0.7x coverage (a 1% payout ratio).
Iron Mountain Inc (IRM) earns $0.54 per share against $3.07 paid out in dividends — 0.2x coverage (a 6% payout ratio).
DLR's wider coverage leaves more cushion if earnings dip. As a rule of thumb, coverage below about 1.5x (a payout ratio above ~65%) is where a dividend starts to look stretched — worth watching for IRM if earnings weaken.
Which fits an early-retirement income portfolio better, DLR or IRM?
For income you need right now, Iron Mountain Inc (IRM) leads: $100,000 invested today pays about $258 a month at the current 3.09% yield, versus $236 a month from Digital Realty Trust, Inc. (DLR) at 2.83%.
IRM also leads on dividend growth (6.8% vs 1.3% a year over five years), so the trailing numbers favor it on both fronts.
On consistency: IRM has raised its dividend 3 consecutive years.
Many income investors simply hold both — the mix pairs current yield with growth and spreads single-name risk. Whichever way you lean, dividends are never guaranteed; recheck the payout each quarter rather than setting and forgetting.
$10,000 with DRIP: projected annual income
If each holding keeps raising its dividend at its real 5-year rate and every payment is reinvested, a $10,000 position pays $424/yr in DLR vs $808/yr in IRM by year 10.
Assumes dividends are reinvested at the current yield and grow at each holding's trailing 5-year dividend CAGR. A projection, not a prediction — no price appreciation modeled.
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