The RMR Group (RMR) AI Stock Analysis

• Market Cap: $528.08M
• Dividend Yield: 10.86%
• Average Volume (3M): 78.77K
• Price to Earnings (P/E): 14.4
• Beta (1Y): 0.74
• Revenue Growth: -16.99%
• EPS Growth: -24.57%
• Country: US
• Employees: 1,000
• Sector: Real Estate
• Sector Strength: 53
• Industry: Real Estate - Services
• EPS (TTM): 0.43
• Shares Outstanding: 15,869,689
• 10 Day Avg. Volume: 72,125
• 30 Day Avg. Volume: 78,768
• PEG Ratio: -0.30
• Price to Book (P/B): 1.77
• Price to Sales (P/S): 0.47
• P/FCF Ratio: 7.30
• Enterprise Value/Market Cap: 0.84
• Enterprise Value/Revenue: 0.59
• Enterprise Value/Gross Profit: 1.58
• Enterprise Value/Ebitda: 7.15
• 1Y Price Target: $18.00
• Price Target Upside: 8.63% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 0

• Rating: 66 Neutral
• Price Target: $18.00 ▲(8.63% Upside)

The RMR Group's stock score is primarily influenced by its financial performance challenges, particularly in revenue growth and profitability. While technical analysis shows mixed signals, the valuation is attractive due to a high dividend yield. The earnings call provided a balanced view with strategic achievements but also highlighted ongoing challenges.

Positive Factors

Expansion of Private Capital Initiatives

The expansion of the private capital platform to over $12 billion indicates a strategic growth area, enhancing RMR's ability to manage larger portfolios and attract more institutional investors, thereby strengthening its market position.

Notable Residential Sector Investments

Investments in the residential sector, particularly value-add acquisitions, support long-term growth and diversification of revenue streams, positioning RMR to benefit from potential appreciation and increased rental income.

DHC's Solid Performance

Strong performance in DHC's SHOP segment reflects effective asset management and operational efficiency, contributing positively to RMR's overall financial health and reinforcing its competitive advantage in property management.

Negative Factors

Revenue Growth Challenges

Declining revenue growth indicates potential issues in maintaining market share or expanding services, which can impact long-term profitability and strategic positioning in the competitive real estate services industry.

RMR Residential Revenue Decline

A decline in RMR Residential's recurring service revenues suggests challenges in maintaining client relationships or competitive pricing, potentially affecting future cash flows and growth prospects in the residential management segment.

Challenging Fundraising Environment

Difficulties in fundraising for private capital can limit RMR's ability to expand its asset management business, impacting growth and diversification efforts, and potentially leading to increased reliance on existing revenue streams.

The RMR Group Business Overview & Revenue Model

Company Description

The RMR Group (RMR) is a leading real estate investment and management firm based in Newton, Massachusetts. The company specializes in managing a diverse portfolio of properties, including commercial real estate investments such as office buildings, industrial facilities, and retail spaces. RMR provides a range of services, including property management, leasing, and development, focusing on enhancing asset value and delivering strategic investment opportunities for its clients and partners.

How the Company Makes Money

RMR generates revenue primarily through property management fees, leasing commissions, and acquisition fees associated with the properties it manages. The company earns a percentage of the rental income generated by the properties, which is a significant source of recurring revenue. Additionally, RMR benefits from asset management fees charged to its clients for overseeing their real estate investments. Strategic partnerships with various real estate investment trusts (REITs) and institutional investors further contribute to RMR's earnings by expanding its portfolio and creating economies of scale in operations. The company also engages in performance-based incentives, allowing it to earn additional income based on the success of the properties it manages.

The RMR Group Financial Statement Overview

Summary

The RMR Group faces challenges in revenue growth and profitability, with declining margins and cash flow growth. The balance sheet remains stable with manageable leverage, but reduced return on equity indicates potential inefficiencies.

Income Statement

The RMR Group's income statement shows a declining revenue trend with a negative growth rate of -6.31% in the TTM period. Gross profit margin has decreased slightly to 30.26%, and net profit margin is relatively low at 2.52%. The EBIT and EBITDA margins are stable but modest at 7.23% and 7.52%, respectively. Overall, the company faces challenges in revenue growth and profitability.

Balance Sheet

The balance sheet reflects a moderate debt-to-equity ratio of 0.48, indicating manageable leverage. Return on equity has decreased to 8.55%, suggesting reduced efficiency in generating profits from equity. The equity ratio is not explicitly calculated but appears stable given the equity and asset figures. The company maintains a balanced financial structure but shows signs of declining profitability.

Cash Flow

Cash flow analysis reveals a decline in free cash flow growth by -15.97% in the TTM period. The operating cash flow to net income ratio is 0.66, indicating moderate cash generation relative to net income. Free cash flow to net income ratio is high at 0.94, suggesting efficient cash conversion. Despite strong cash conversion, the decline in free cash flow growth is a concern.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	753.59M	897.61M	962.32M	832.50M	607.24M	589.50M
Gross Profit	282.55M	288.46M	169.56M	133.86M	117.56M	107.55M
EBITDA	62.27M	69.07M	121.05M	90.81M	78.57M	73.20M
Net Income	19.52M	23.13M	57.15M	77.47M	81.01M	66.33M
Balance Sheet
Total Assets	648.02M	700.49M	582.42M	542.40M	497.91M	690.25M
Cash, Cash Equivalents and Short-Term Investments	121.28M	141.60M	267.99M	189.09M	159.84M	369.66M
Total Debt	116.25M	114.31M	30.11M	30.32M	34.07M	36.44M
Total Liabilities	238.69M	281.08M	158.76M	172.67M	150.20M	149.35M
Stockholders Equity	231.34M	237.57M	240.07M	206.62M	195.12M	295.92M
Cash Flow
Free Cash Flow	50.61M	57.51M	105.23M	100.15M	70.65M	76.90M
Operating Cash Flow	54.42M	61.38M	109.22M	101.27M	71.79M	77.50M
Investing Cash Flow	-167.66M	-209.84M	49.50M	-10.59M	-1.14M	-5.92M
Financing Cash Flow	26.54M	22.07M	-79.81M	-61.43M	-280.48M	-60.36M

The RMR Group Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 16.57
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RMR, the sentiment is Negative. The current price of 16.57 is below the 20-day moving average (MA) of 16.86, below the 50-day MA of 16.69, and below the 200-day MA of 16.61, indicating a bearish trend. The MACD of 0.10 indicates Positive momentum. The RSI at 46.61 is Neutral, neither overbought nor oversold. The STOCH value of 27.95 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for RMR.

The RMR Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RMR	66 Neutral	$528.08M	14.39	8.12%	10.86%	-16.99%	-24.57%
FRPH	58 Neutral	468.18M	87.44	1.25%	―	2.45%	-29.26%
TCI	55 Neutral	403.89M	61.18	0.79%	―	-4.20%	11.20%
MLP	51 Neutral	376.30M	-27.24	-22.27%	―	74.64%	-256.63%
Sector *	65 Neutral	$2.17B	12.19	3.79%	4.94%	3.15%	1.96%

The RMR Group Corporate Events

The RMR Group Highlights Growth and Sustainability

On June 2, 2025, The RMR Group Inc. released an investor presentation highlighting its diversified revenue sources and durable earnings, with nearly 70% of service revenues derived from long-term contracts. The company is well-positioned for growth with a scalable infrastructure and significant liquidity, presenting a compelling investment opportunity due to its valuation discount to industry peers. The presentation also emphasized RMR’s commitment to sustainability and its competitive advantage as a vertically integrated real estate operating platform.