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 65 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.
Each year in the past 5 years RMR has been profitable.
Each year in the past 5 years RMR had a positive operating cash flow.
1.2 Ratios
With an excellent Return On Assets value of 3.06%, RMR belongs to the best of the industry, outperforming 83.08% of the companies in the same industry.
With an excellent Return On Equity value of 8.49%, RMR belongs to the best of the industry, outperforming 83.08% of the companies in the same industry.
RMR has a better Return On Invested Capital (7.87%) than 93.85% of its industry peers.
RMR had an Average Return On Invested Capital over the past 3 years of 15.75%. This is significantly above the industry average of 5.60%.
The last Return On Invested Capital (7.87%) 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 | 3.06% | ||
| ROE | 8.49% | ||
| ROIC | 7.87% |
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 has a Profit Margin of 2.47%. This is in the better half of the industry: RMR outperforms 72.31% of its industry peers.
RMR's Profit Margin has declined in the last couple of years.
The Operating Margin of RMR (6.45%) is better than 73.85% of its industry peers.
RMR's Operating Margin has declined in the last couple of years.
RMR has a Gross Margin of 36.18%. This is in the better half of the industry: RMR outperforms 66.15% of its industry peers.
In the last couple of years the Gross Margin of RMR has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 6.45% | ||
| PM (TTM) | 2.47% | ||
| GM | 36.18% |
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
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), RMR is creating value.
The number of shares outstanding for RMR has been increased compared to 1 year ago.
The number of shares outstanding for RMR has been increased compared to 5 years ago.
RMR has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 2.78 indicates that RMR is not a great score, but indicates only limited risk for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 2.78, RMR is in the better half of the industry, outperforming 72.31% of the companies in the same industry.
A Debt/Equity ratio of 0.37 indicates that RMR is not too dependend on debt financing.
With a Debt to Equity ratio value of 0.37, RMR perfoms like the industry average, outperforming 56.92% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.37 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 2.78 |
ROIC/WACC0.94
WACC8.39%
2.3 Liquidity
A Current Ratio of 2.51 indicates that RMR has no problem at all paying its short term obligations.
RMR has a better Current ratio (2.51) than 70.77% of its industry peers.
RMR has a Quick Ratio of 2.51. This indicates that RMR is financially healthy and has no problem in meeting its short term obligations.
Looking at the Quick ratio, with a value of 2.51, RMR is in the better half of the industry, outperforming 76.92% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.51 | ||
| Quick Ratio | 2.51 |
3. Growth
3.1 Past
RMR shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -27.17%.
The earnings per share for RMR have been decreasing by -19.11% on average. This is quite bad
Looking at the last year, RMR shows a very negative growth in Revenue. The Revenue has decreased by -18.14% in the last year.
The Revenue has been growing slightly by 4.70% on average over the past years.
EPS 1Y (TTM)-27.17%
EPS 3Y-9.71%
EPS 5Y-19.11%
EPS Q2Q%-28.21%
Revenue 1Y (TTM)-18.14%
Revenue growth 3Y13.92%
Revenue growth 5Y4.7%
Sales Q2Q%-23.46%
3.2 Future
Based on estimates for the next years, RMR will show a very negative growth in Earnings Per Share. The EPS will decrease by -12.87% on average per year.
RMR is expected to show a decrease in Revenue. In the coming years, the Revenue will decrease by -4.07% yearly.
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
With a Price/Earnings ratio of 12.32, RMR is valued correctly.
87.69% of the companies in the same industry are more expensive than RMR, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 26.65. RMR is valued rather cheaply when compared to this.
The Price/Forward Earnings ratio is 13.68, which indicates a correct valuation of RMR.
RMR's Price/Forward Earnings ratio is rather cheap when compared to the industry. RMR is cheaper than 90.77% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of RMR to the average of the S&P500 Index (21.27), we can say RMR is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.32 | ||
| Fwd PE | 13.68 |
4.2 Price Multiples
92.31% of the companies in the same industry are more expensive than RMR, based on the Enterprise Value to EBITDA ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 7.96 |
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 11.03%, RMR is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 3.69, 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 2.44, RMR pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 11.03% |
5.2 History
The dividend of RMR has a limited annual growth rate of 3.94%.
RMR has been paying a dividend for at least 10 years, so it has 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 153.94% 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.
DP153.94%
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 Owners74.19%
Inst Owner Change-5.36%
Ins Owners2.58%
Ins Owner Change0%
Market Cap526.34M
Analysts74.29
Price Target24.48 (48.27%)
Short Float %3.04%
Short Ratio3.22
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 11.03% |
Yearly Dividend1.69
Dividend Growth(5Y)3.94%
DP153.94%
Div Incr Years2
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-2.79%
Min EPS beat(2)-6.02%
Max EPS beat(2)0.44%
EPS beat(4)1
Avg EPS beat(4)-5.56%
Min EPS beat(4)-11.41%
Max EPS beat(4)0.44%
EPS beat(8)4
Avg EPS beat(8)-1.77%
EPS beat(12)5
Avg EPS beat(12)-3.18%
EPS beat(16)7
Avg EPS beat(16)-0.34%
Revenue beat(2)0
Avg Revenue beat(2)-21.04%
Min Revenue beat(2)-23%
Max Revenue beat(2)-19.07%
Revenue beat(4)0
Avg Revenue beat(4)-14.6%
Min Revenue beat(4)-23%
Max Revenue beat(4)-4.61%
Revenue beat(8)2
Avg Revenue beat(8)-5.05%
Revenue beat(12)5
Avg Revenue beat(12)-1.45%
Revenue beat(16)8
Avg Revenue beat(16)1.02%
PT rev (1m)0%
PT rev (3m)0%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-20.51%
EPS NY rev (1m)0%
EPS NY rev (3m)-18.6%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-2.07%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-10.31%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.32 | ||
| Fwd PE | 13.68 | ||
| P/S | 0.65 | ||
| P/FCF | N/A | ||
| P/OCF | 8.18 | ||
| P/B | 2.25 | ||
| P/tB | 3.64 | ||
| EV/EBITDA | 7.96 |
EPS(TTM)1.34
EY8.12%
EPS(NY)1.21
Fwd EY7.31%
FCF(TTM)-0.32
FCFYN/A
OCF(TTM)2.02
OCFY12.23%
SpS25.23
BVpS7.35
TBVpS4.53
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.06% | ||
| ROE | 8.49% | ||
| ROCE | 9.38% | ||
| ROIC | 7.87% | ||
| ROICexc | 10.47% | ||
| ROICexgc | 13.36% | ||
| OM | 6.45% | ||
| PM (TTM) | 2.47% | ||
| GM | 36.18% | ||
| 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 Turnover1.24
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.37 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 1.45 | ||
| Cap/Depr | 948.19% | ||
| Cap/Sales | 9.28% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 107.77% | ||
| Profit Quality | N/A | ||
| Current Ratio | 2.51 | ||
| Quick Ratio | 2.51 | ||
| Altman-Z | 2.78 |
F-Score5
WACC8.39%
ROIC/WACC0.94
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)-27.17%
EPS 3Y-9.71%
EPS 5Y-19.11%
EPS Q2Q%-28.21%
EPS Next Y-22.19%
EPS Next 2Y-12.87%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)-18.14%
Revenue growth 3Y13.92%
Revenue growth 5Y4.7%
Sales Q2Q%-23.46%
Revenue Next Year-8.95%
Revenue Next 2Y-4.07%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y-54.49%
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-111.33%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-30.88%
OCF growth 3Y-5.1%
OCF growth 5Y-20.9%