RMR GROUP INC/THE - A (RMR) Stock Fundamental Analysis
NASDAQ:RMR - Nasdaq - US74967R1068 - Common Stock - Currency: USD
RMR gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 64 industry peers in the Real Estate Management & Development industry. RMR scores excellent on profitability, but there are some minor concerns on its financial health. RMR has a valuation in line with the averages, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
RMR had positive earnings in the past year.
RMR had a positive operating cash flow in the past year.
RMR had positive earnings in each of the past 5 years.
Each year in the past 5 years RMR had a positive operating cash flow.
1.2 Ratios
RMR has a better Return On Assets (2.95%) than 81.25% of its industry peers.
RMR's Return On Equity of 8.26% is amongst the best of the industry. RMR outperforms 82.81% of its industry peers.
RMR has a Return On Invested Capital of 7.72%. This is amongst the best in the industry. RMR outperforms 93.75% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for RMR is significantly above the industry average of 5.67%.
The last Return On Invested Capital (7.72%) for RMR is well below the 3 year average (15.75%), which needs to be investigated, but indicates that RMR had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.95% | ||
| ROE | 8.26% | ||
| ROIC | 7.72% |
ROA(3y)6.39%
ROA(5y)6.08%
ROE(3y)16.48%
ROE(5y)15.45%
ROIC(3y)15.75%
ROIC(5y)14.56%
1.3 Margins
RMR's Profit Margin of 2.54% is fine compared to the rest of the industry. RMR outperforms 68.75% of its industry peers.
In the last couple of years the Profit Margin of RMR has declined.
RMR has a Operating Margin of 6.72%. This is in the better half of the industry: RMR outperforms 70.31% of its industry peers.
In the last couple of years the Operating Margin of RMR has declined.
RMR's Gross Margin of 37.76% is fine compared to the rest of the industry. RMR outperforms 64.06% of its industry peers.
In the last couple of years the Gross Margin of RMR has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 6.72% | ||
| PM (TTM) | 2.54% | ||
| GM | 37.76% |
OM growth 3Y-19.87%
OM growth 5Y-25.59%
PM growth 3Y-24.18%
PM growth 5Y-24.54%
GM growth 3Y-6.25%
GM growth 5Y-8.54%
2. Health
2.1 Basic Checks
RMR has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
RMR has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, RMR has more shares outstanding
Compared to 1 year ago, RMR has a worse debt to assets ratio.
2.2 Solvency
RMR has an Altman-Z score of 2.64. This is not the best score and indicates that RMR is in the grey zone with still only limited risk for bankruptcy at the moment.
RMR has a better Altman-Z score (2.64) than 71.88% of its industry peers.
A Debt/Equity ratio of 0.40 indicates that RMR is not too dependend on debt financing.
With a Debt to Equity ratio value of 0.40, RMR perfoms like the industry average, outperforming 56.25% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.4 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 2.64 |
ROIC/WACC0.92
WACC8.35%
2.3 Liquidity
RMR has a Current Ratio of 2.27. This indicates that RMR is financially healthy and has no problem in meeting its short term obligations.
RMR has a better Current ratio (2.27) than 67.19% of its industry peers.
A Quick Ratio of 2.27 indicates that RMR has no problem at all paying its short term obligations.
RMR has a better Quick ratio (2.27) than 71.88% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.27 | ||
| Quick Ratio | 2.27 |
3. Growth
3.1 Past
The earnings per share for RMR have decreased strongly by -27.75% in the last year.
RMR shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -19.11% yearly.
The Revenue for RMR has decreased by -16.99% in the past year. This is quite bad
The Revenue has been growing slightly by 4.70% on average over the past years.
EPS 1Y (TTM)-27.75%
EPS 3Y-9.71%
EPS 5Y-19.11%
EPS Q2Q%-24.32%
Revenue 1Y (TTM)-16.99%
Revenue growth 3Y13.92%
Revenue growth 5Y4.7%
Sales Q2Q%-77.23%
3.2 Future
The Earnings Per Share is expected to decrease by -12.87% on average over the next years. This is quite bad
The Revenue is expected to decrease by -4.07% on average over the next years.
EPS Next Y-22.19%
EPS Next 2Y-12.87%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year-8.95%
Revenue Next 2Y-4.07%
Revenue Next 3YN/A
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
RMR is valuated correctly with a Price/Earnings ratio of 13.21.
RMR's Price/Earnings ratio is rather cheap when compared to the industry. RMR is cheaper than 87.50% of the companies in the same industry.
RMR's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 26.85.
With a Price/Forward Earnings ratio of 13.68, RMR is valued correctly.
RMR's Price/Forward Earnings ratio is rather cheap when compared to the industry. RMR is cheaper than 90.63% of the companies in the same industry.
RMR is valuated cheaply when we compare the Price/Forward Earnings ratio to 34.98, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.21 | ||
| Fwd PE | 13.68 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, RMR is valued cheaply inside the industry as 96.88% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 8.13 |
4.3 Compensation for Growth
The decent profitability rating of RMR may justify a higher PE ratio.
A cheap valuation may be justified as RMR's earnings are expected to decrease with -12.87% in the coming years.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-12.87%
EPS Next 3YN/A
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 10.86%, RMR is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 3.47, RMR pays a better dividend. On top of this RMR pays more dividend than 100.00% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.36, RMR pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 10.86% |
5.2 History
The dividend of RMR has a limited annual growth rate of 3.94%.
RMR has paid a dividend for at least 10 years, which is a reliable track record.
The dividend of RMR decreased in the last 3 years.
Dividend Growth(5Y)3.94%
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
RMR pays out 160.52% of its income as dividend. This is not a sustainable payout ratio.
The Dividend Rate of RMR has been growing, while earnings will be declining. This means the dividend growth is most likely not sustainable.
DP160.52%
EPS Next 2Y-12.87%
EPS Next 3YN/A
16.51
+0.21 (+1.29%)
Chartmill FA Rating
GICS SectorReal Estate
GICS IndustryGroupEquity Real Estate Investment Trusts (REITs)
GICS IndustryReal Estate Management & Development
Earnings (Last)
Earnings (Next)
Inst Owners72.64%
Inst Owner Change1.26%
Ins Owners2.58%
Ins Owner Change0%
Market Cap526.34M
Analysts74.29
Price Target24.48 (48.27%)
Short Float %2.37%
Short Ratio3.07
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 10.86% |
Yearly Dividend1.69
Dividend Growth(5Y)3.94%
DP160.52%
Div Incr Years2
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-8.3%
Min EPS beat(2)-10.57%
Max EPS beat(2)-6.02%
EPS beat(4)1
Avg EPS beat(4)-6.89%
Min EPS beat(4)-11.41%
Max EPS beat(4)0.44%
EPS beat(8)3
Avg EPS beat(8)-3.1%
EPS beat(12)5
Avg EPS beat(12)-2.39%
EPS beat(16)6
Avg EPS beat(16)-1.36%
Revenue beat(2)0
Avg Revenue beat(2)-50.13%
Min Revenue beat(2)-77.26%
Max Revenue beat(2)-23%
Revenue beat(4)0
Avg Revenue beat(4)-30.99%
Min Revenue beat(4)-77.26%
Max Revenue beat(4)-4.61%
Revenue beat(8)1
Avg Revenue beat(8)-17.45%
Revenue beat(12)4
Avg Revenue beat(12)-9.05%
Revenue beat(16)8
Avg Revenue beat(16)-3.67%
PT rev (1m)0%
PT rev (3m)0%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-31.33%
EPS NY rev (1m)0%
EPS NY rev (3m)0%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-1.89%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.21 | ||
| Fwd PE | 13.68 | ||
| P/S | 0.7 | ||
| P/FCF | N/A | ||
| P/OCF | 9.67 | ||
| P/B | 2.28 | ||
| P/tB | 3.82 | ||
| EV/EBITDA | 8.13 |
EPS(TTM)1.25
EY7.57%
EPS(NY)1.21
Fwd EY7.31%
FCF(TTM)-1.3
FCFYN/A
OCF(TTM)1.71
OCFY10.34%
SpS23.64
BVpS7.26
TBVpS4.32
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.95% | ||
| ROE | 8.26% | ||
| ROCE | 9.2% | ||
| ROIC | 7.72% | ||
| ROICexc | 9.9% | ||
| ROICexgc | 12.67% | ||
| OM | 6.72% | ||
| PM (TTM) | 2.54% | ||
| GM | 37.76% | ||
| FCFM | N/A |
ROA(3y)6.39%
ROA(5y)6.08%
ROE(3y)16.48%
ROE(5y)15.45%
ROIC(3y)15.75%
ROIC(5y)14.56%
ROICexc(3y)30.24%
ROICexc(5y)28.29%
ROICexgc(3y)31.55%
ROICexgc(5y)29.16%
ROCE(3y)18.76%
ROCE(5y)17.35%
ROICexcg growth 3Y-16.53%
ROICexcg growth 5Y-29.02%
ROICexc growth 3Y-22.84%
ROICexc growth 5Y-32.26%
OM growth 3Y-19.87%
OM growth 5Y-25.59%
PM growth 3Y-24.18%
PM growth 5Y-24.54%
GM growth 3Y-6.25%
GM growth 5Y-8.54%
F-Score5
Asset Turnover1.16
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.4 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 1.53 | ||
| Cap/Depr | 993.81% | ||
| Cap/Sales | 12.72% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 90.25% | ||
| Profit Quality | N/A | ||
| Current Ratio | 2.27 | ||
| Quick Ratio | 2.27 | ||
| Altman-Z | 2.64 |
F-Score5
WACC8.35%
ROIC/WACC0.92
Cap/Depr(3y)683.9%
Cap/Depr(5y)444.34%
Cap/Sales(3y)2.94%
Cap/Sales(5y)1.82%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-27.75%
EPS 3Y-9.71%
EPS 5Y-19.11%
EPS Q2Q%-24.32%
EPS Next Y-22.19%
EPS Next 2Y-12.87%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)-16.99%
Revenue growth 3Y13.92%
Revenue growth 5Y4.7%
Sales Q2Q%-77.23%
Revenue Next Year-8.95%
Revenue Next 2Y-4.07%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y-21.56%
EBIT growth 3Y-8.72%
EBIT growth 5Y-22.09%
EBIT Next Year63.78%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-134.02%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-56.5%
OCF growth 3Y-5.1%
OCF growth 5Y-20.9%