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1. Company Snapshot

1.a. Company Description

The RMR Group Inc., through its subsidiary, The RMR Group LLC, provides business and property management services in the United States.The company provides management services to its four publicly traded real estate investment trusts and three real estate operating companies.It also provides investment advisory services.


The company was formerly known as REIT Management & Research Inc.and changed its name to The RMR Group Inc.in September 2015.


The RMR Group Inc.was founded in 1986 and is headquartered in Newton, Massachusetts.

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1.b. Last Insights on RMR

The RMR Group Inc.'s recent performance was negatively impacted by a decline in earnings, with Q3 earnings of $0.28 per share, in line with estimates, but down from $0.37 per share a year ago. The company's leadership promotions, including Matt Jordan's move to COO and Matt Brown's appointment as CFO, may lead to short-term uncertainty. Despite a diversified real estate portfolio and low leverage, the company's growth prospects appear muted. A "buy" rating from an analyst citing profit margins and dividend growth may not be sufficient to offset these concerns.

1.c. Company Highlights

2. RMR Group's Q4 2025 Earnings: A Closer Look at Financial Performance

The RMR Group reported fiscal fourth quarter 2025 results, including distributable earnings of $0.44 per share, adjusted net income of $0.22 per share, and adjusted EBITDA of $20.5 million. The actual EPS of $0.22 matched estimates, indicating a stable performance. The company's financial performance was characterized by its ability to execute clients' strategic initiatives, completing nearly $2 billion of accretive debt financings and over $300 million in asset sales in its managed equity REITs.

Publication Date: Nov -24

📋 Highlights
  • Q4 2025 Financial Highlights: Distributable earnings $0.44/share, adjusted net income $0.22/share, and adjusted EBITDA of $20.5 million.
  • Client Capital Activity: Executed $2 billion in accretive debt financings and $302 million in asset sales across managed REITs, including 40 hotels sold for $292 million by SVC.
  • Private Capital Growth: RMR Residential targets $250 million in multifamily real estate investments with a $100 million seed from RMR.
  • Q1 Guidance: Adjusted EBITDA forecast $18–20 million, distributable earnings $0.42–0.44/share, and $0.16–0.18/share adjusted net income due to AlerisLife exit.

Business Highlights

Notable updates include DHC's solid quarterly results, with consolidated SHOP NOI increasing 8% year-over-year to $29.6 million, and SVC's progress in selling non-core hotels, with 40 hotels sold for over $292 million. These achievements demonstrate the company's ability to drive growth and optimize its portfolio.

Private Capital Growth Initiatives

RMR's private capital clients provide stable cash flows, which can be used to pursue new growth initiatives. The company is focused on residential, credit, and select development opportunities in its private capital growth initiatives. RMR Residential launched fundraising for an enhanced growth venture in early September, targeting value-add returns in multifamily real estate.

Outlook and Guidance

The company expects recurring service revenues to decrease to approximately $42.5 million next quarter, driven by lost fee revenue from the sale of AlerisLife's business and decreases in certain managed REITs' enterprise values. Adjusted EBITDA is expected to be between $18 million to $20 million, distributable earnings between $0.42 and $0.44 per share, and adjusted net income between $0.16 and $0.18 per share next quarter.

Valuation and Growth Prospects

Analysts estimate next year's revenue growth at -8.3%. The current P/E Ratio of 13.29 and EV/EBITDA of 7.89 suggest that the company's valuation is relatively reasonable. The Dividend Yield of 11.56% is also attractive, indicating a potentially stable return for investors.

Strategic Developments

OPI's restructuring support agreement will result in a flat $14 million business management fee for RMR during the first two years. The company is selling two loans on its balance sheet, with no plan to add more loans to RMR's balance sheet. A rights offering at Seven Hills is underway, expected to raise $65 million in equity, which will be used to deploy $200 million in additional loan investments over the next 6 months.

3. NewsRoom

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68 Graham Value All-Star (GVAS) November Dividend Dogs Show 27 'Safer' And 17 Ideal Buys

Dec -02

Source: seekingalpha.com

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The RMR Group Inc. (RMR) Q4 2025 Earnings Call Transcript

Nov -13

Source: seekingalpha.com

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RMR Group (RMR) Meets Q4 Earnings Estimates

Nov -13

Source: zacks.com

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The RMR Group Inc. Announces Fiscal Fourth Quarter 2025 Results

Nov -12

Source: businesswire.com

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The RMR Group Fiscal Fourth Quarter 2025 Conference Call Scheduled for Thursday, November 13th

Oct -15

Source: businesswire.com

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Discovery Senior Living Enters Management Agreements with Diversified Healthcare Trust, Deepens Industry Leadership Position Adding a 42 Community, Multi-State Portfolio

Oct -08

Source: newsfilecorp.com

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The RMR Group Announces Executive Leadership Promotions

Sep -29

Source: businesswire.com

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The RMR Group Inc. (RMR) Q3 2025 Earnings Call Transcript

Aug -06

Source: seekingalpha.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (5.95%)

6. Segments

Other Reimbursable Expenses

Expected Growth: 4.83%

The 4.83% growth in Other Reimbursable Expenses at The RMR Group Inc. is driven by increased property management fees, higher reimbursement rates, and an expansion of services offered to clients, resulting in higher billable hours and expenses. Additionally, the company's growing portfolio of properties under management has led to increased expenses related to property operations and maintenance.

Management Services

Expected Growth: 8.4%

The 8.4% growth in Management Services from The RMR Group Inc. is driven by increasing demand for property management and leasing services, expansion into new markets, and strategic acquisitions. Additionally, the company's focus on technology integration and operational efficiency has improved its ability to attract and retain clients, contributing to revenue growth.

Reimbursable Compensation and Benefits

Expected Growth: 8.37%

The 8.37% growth in Reimbursable Compensation and Benefits from The RMR Group Inc. is driven by increasing property values, rising rent and fees, and a growing portfolio of properties under management, resulting in higher reimbursement rates and fees earned.

Termination and Incentive Business Management Fees

Expected Growth: 7.92%

The 7.92% growth in Termination and Incentive Business Management Fees from The RMR Group Inc. is driven by increasing demand for property management services, expansion into new markets, and strategic acquisitions. Additionally, the company's focus on operational efficiency and cost savings initiatives have contributed to the growth.

Reimbursable Equity Based Compensation

Expected Growth: 8.9%

The 8.9% growth in Reimbursable Equity Based Compensation from The RMR Group Inc. is driven by increasing property values, rising management fees, and a growing portfolio of properties under management. Additionally, the company's ability to attract and retain top talent through competitive compensation packages has contributed to the growth.

Advisory Services

Expected Growth: 8.37%

The RMR Group Inc.'s 8.37% growth in Advisory Services is driven by increasing demand for real estate investment management, expansion into new markets, and strategic partnerships. Additionally, the company's expertise in property management and leasing, as well as its ability to provide comprehensive solutions to clients, contribute to its growth momentum.

7. Detailed Products

Property Management

The RMR Group Inc. provides property management services to commercial and residential properties, including office buildings, apartments, and condominiums.

Facilities Management

The RMR Group Inc. offers facilities management services to ensure that buildings and facilities are well-maintained and running efficiently.

Construction Management

The RMR Group Inc. provides construction management services to oversee construction projects from start to finish.

Leasing and Brokerage

The RMR Group Inc. provides leasing and brokerage services to help property owners find tenants and negotiate leases.

Investment and Advisory Services

The RMR Group Inc. provides investment and advisory services to help clients make informed investment decisions.

8. The RMR Group Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for The RMR Group Inc. is medium due to the availability of alternative investment options for investors.

Bargaining Power Of Customers

The bargaining power of customers for The RMR Group Inc. is low due to the company's diversified portfolio and lack of dependence on a single customer.

Bargaining Power Of Suppliers

The bargaining power of suppliers for The RMR Group Inc. is medium due to the company's reliance on a few key suppliers for its operations.

Threat Of New Entrants

The threat of new entrants for The RMR Group Inc. is high due to the relatively low barriers to entry in the real estate investment trust (REIT) industry.

Intensity Of Rivalry

The intensity of rivalry for The RMR Group Inc. is high due to the competitive nature of the REIT industry and the presence of several established players.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 11.15%
Debt Cost 3.95%
Equity Weight 88.85%
Equity Cost 10.55%
WACC 9.82%
Leverage 12.54%

11. Quality Control: The RMR Group Inc. passed 7 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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RMR Group

A-Score: 6.2/10

Value: 7.4

Growth: 4.4

Quality: 5.8

Yield: 10.0

Momentum: 1.0

Volatility: 8.7

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Kennedy-Wilson Holdings

A-Score: 5.1/10

Value: 5.7

Growth: 3.7

Quality: 3.5

Yield: 10.0

Momentum: 2.0

Volatility: 6.0

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Newmark

A-Score: 4.9/10

Value: 5.0

Growth: 4.0

Quality: 5.4

Yield: 2.0

Momentum: 7.5

Volatility: 5.7

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RE/MAX

A-Score: 4.3/10

Value: 8.5

Growth: 3.2

Quality: 6.8

Yield: 2.0

Momentum: 2.0

Volatility: 3.7

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FRP Holdings

A-Score: 3.9/10

Value: 2.5

Growth: 4.0

Quality: 6.5

Yield: 0.0

Momentum: 1.5

Volatility: 8.7

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Marcus Millichap

A-Score: 3.9/10

Value: 5.1

Growth: 1.4

Quality: 5.0

Yield: 3.0

Momentum: 2.0

Volatility: 6.7

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

15.59$

Current Price

15.59$

Potential

-0.00%

Expected Cash-Flows