The RMR Group Inc.
The RMR Group Inc. Fundamental Analysis
The RMR Group Inc. (RMR) shows weak financial fundamentals with a PE ratio of 15.38, profit margin of 3.25%, and ROE of 9.05%. The company generates $1.2B in annual revenue with weak year-over-year growth of -21.98%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 19.5/100 based on profitability, valuation, growth, and balance sheet metrics. The F grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze RMR's fundamental strength across five key dimensions:
Efficiency Score
WeakRMR struggles to generate sufficient returns from assets.
Valuation Score
ModerateRMR shows balanced valuation metrics.
Growth Score
WeakRMR faces weak or negative growth trends.
Financial Health Score
ExcellentRMR maintains a strong and stable balance sheet.
Profitability Score
WeakRMR struggles to sustain strong margins.
Key Financial Metrics
Is RMR Expensive or Cheap?
P/E Ratio
RMR trades at 15.38 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, RMR's PEG of 18.46 indicates potential overvaluation.
Price to Book
The market values The RMR Group Inc. at 1.41 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 6.83 times EBITDA. This is generally considered low.
How Well Does RMR Make Money?
Net Profit Margin
For every $100 in sales, The RMR Group Inc. keeps $3.25 as profit after all expenses.
Operating Margin
Core operations generate 9.60 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $9.05 in profit for every $100 of shareholder equity.
ROA
The RMR Group Inc. generates $3.04 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
The RMR Group Inc. produces operating cash flow of $185.17M, showing steady but balanced cash generation.
Free Cash Flow
The RMR Group Inc. generates strong free cash flow of $175.10M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $5.49 in free cash annually.
FCF Yield
RMR converts 15.05% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
15.38
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
18.46
vs 25 benchmark
P/B Ratio
Price to book value ratio
1.41
vs 25 benchmark
P/S Ratio
Price to sales ratio
0.95
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.69
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.73
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.09
vs 25 benchmark
ROA
Return on assets percentage
0.03
vs 25 benchmark
ROCE
Return on capital employed
0.11
vs 25 benchmark
How RMR Stacks Against Its Sector Peers
| Metric | RMR Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 15.38 | 23.05 | Better (Cheaper) |
| ROE | 9.05% | 668.00% | Weak |
| Net Margin | 3.25% | -37500.00% (disorted) | Weak |
| Debt/Equity | 0.69 | -17.10 (disorted) | Distorted |
| Current Ratio | 1.73 | 22.78 | Neutral |
| ROA | 3.04% | 526.00% | Weak |
RMR outperforms its industry in 1 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews The RMR Group Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
15.58%
Industry Style: Income, Inflation Hedge, REIT
High GrowthEPS CAGR
-40.54%
Industry Style: Income, Inflation Hedge, REIT
DecliningFCF CAGR
-4.90%
Industry Style: Income, Inflation Hedge, REIT
Declining