Cash flow generation is erratic, with the AFFO payout ratio swinging from 141% in 2026Q2 to 98% in 2026Q3, indicating the dividend is not consistently covered by distributable cash flow and may rely on volatile non-operating cash inflows.
The RMR Group Inc. (RMR) cash flow statement — 13-year operating, investing & financing cash flows
| Metric | TTM | Sep'25 | Sep'24 | Sep'23 | Sep'22 | Sep'21 | Sep'20 | Sep'19 | Sep'18 | Sep'17 | Sep'16 | Sep'15 | Sep'14 | Sep'13 |
|---|
| Cash from Operations | 103.9M | 75.75M | 61.38M | 109.22M | 101.27M | 71.79M | 77.5M | 198.21M | 228.47M | 125.94M | 98.82M | 102.08M | 31.68M | 6.13M |
| Operating CF Growth % | 623.72% | 23.42% | -43.8% | 7.85% | 41.06% | -7.36% | -60.9% | -13.24% | 81.42% | 27.43% | -3.19% | 222.21% | 416.99% | - |
| Operating CF / Revenue % | 16.26% | 10.82% | 6.84% | 11.35% | 12.16% | 11.82% | 13.15% | 27.79% | 56.42% | 46.35% | 37.02% | 52.91% | 11.11% | 2.36% |
| Net Income | 19.81M | 38.68M | 53.13M | 127.77M | 77.47M | 81.01M | 66.33M | 169.04M | 217.43M | 108.67M | 122.36M | 77.42M | 10.29M | -31.82M |
| Depreciation & Amortization | 17.29M | 11.55M | 4.71M | 1.1M | 993K | 973K | 968K | 1.02M | 1.25M | 2.04M | 1.77M | 2.12M | 2.45M | 2.4M |
| Stock-Based Compensation | 0 | 0 | 0 | 13.43M | 10.85M | 0 | 0 | 11.41M | 11.77M | 7.73M | 8.57M | 5.93M | 11.44M | 0 |
| Other Non-Cash Items | 38.92M | 11.78M | 6.12M | -23.77M | 1.82M | -6.32M | 9.39M | 14.09M | -17.89M | 3.6M | 2.11M | -4.62M | -7.75M | -1.34M |
| Working Capital Changes | 4.09M | 11.76M | -5.64M | -8.21M | 8.58M | -9.11M | -1.03M | 2.66M | -3.89M | 3.62M | -36.78M | 27.16M | 26.69M | 36.89M |
| Cash from Investing | -169.99M | -183.86M | -209.84M | 49.5M | -10.59M | -1.14M | -5.92M | -14.73M | -648K | -12.83M | -3.55M | -42.85M | -14.96M | -1.86M |
| Acquisitions (Net) | -768K | -11.9M | -78.98M | 0 | -9.47M | 0 | -5.32M | -14.03M | 0 | -12M | -2.48M | 1.24M | -16.84M | 0 |
| Purchase of Investments | -1.18M | -1.95M | 0 | 0 | -9.47M | 0 | 0 | -28.25M | 0 | 0 | 0 | -46.39M | -825K | 0 |
| Sale of Investments | 61.73M | 0 | 0 | 53.48M | 18.94M | 0 | 0 | 14.22M | 0 | 0 | 0 | 2.37M | 2.9M | 1.1M |
| Other Investing | -223.86M | -166.36M | -126.99M | 0 | -9.47M | 0 | 0 | 14.03M | 0 | -12M | -2.48M | 1.33M | 1.23M | 1.1M |
| Cash from Financing | 8.31M | 28.81M | 22.07M | -79.81M | -61.43M | -280.48M | -60.36M | -81.8M | -79.61M | -70.3M | -63.96M | -166.43M | 110.58M | 4.71M |
| Dividends Paid | -38.3M | -30.35M | -28.42M | -26.58M | -25.73M | -139.78M | -24.79M | -22.73M | -16.17M | -16.09M | -17.21M | -224.34M | 0 | 0 |
| Common Dividends | -38.3M | -30.35M | -28.42M | -26.58M | -25.73M | -139.78M | -24.79M | -22.73M | -16.17M | -16.09M | -17.21M | -224.34M | 0 | 0 |
| Debt Issuance (Net) | 57K | 1000K | 1000K | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 1000K | 1000K |
| Share Repurchases | -848K | -903K | -1.14M | -734K | -547K | -834K | -523K | -827K | -987K | -358K | -91K | 0 | 0 | 0 |
| Other Financing | -728K | -36.55M | -36.52M | -52.5M | -35.15M | -139.86M | -35.05M | -58.24M | -62.45M | -53.85M | -46.66M | 0 | 53.58M | -19.79M |
| Net Change in Cash | -57.77M | -79.3M | -126.39M | 78.9M | 29.25M | -209.83M | 11.21M | 101.6M | 148.21M | 42.81M | 31.34M | -107.23M | 127.17M | 8.91M |
| Exchange Rate Effect | 0 | 0 | 0 | 0 | 0 | 0 | 0 | -85K | -6K | -1K | 23K | -35K | -132K | -62K |
| Cash at Beginning | 80.1M | 141.6M | 267.99M | 189.09M | 159.84M | 369.66M | 358.45M | 256.85M | 108.64M | 65.83M | 34.5M | 141.73M | 14.56M | 5.65M |
| Cash at End | 63.51M | 62.3M | 141.6M | 267.99M | 189.09M | 159.84M | 369.66M | 358.45M | 256.85M | 108.64M | 65.83M | 34.5M | 141.73M | 14.56M |
| Free Cash Flow | 97.99M | 72.1M | 57.51M | 105.23M | 100.15M | 70.65M | 76.9M | 197.51M | 227.82M | 125.11M | 97.75M | 100.68M | 30.26M | 3.17M |
| FCF Growth % | 93.62% | 25.36% | -45.35% | 5.08% | 41.75% | -8.12% | -61.07% | -13.3% | 82.1% | 27.98% | -2.9% | 232.66% | 854.7% | - |
| FCF / Revenue % | 15.34% | 10.3% | 6.41% | 10.94% | 12.03% | 11.63% | 13.04% | 27.69% | 56.26% | 46.04% | 36.62% | 52.18% | 10.62% | 1.22% |
Quick answers to the most common questions about buying RMR stock.
The RMR Group Inc. (RMR) generated $75.7M in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
The RMR Group Inc. (RMR) generated $72.1M in free cash flow in 2025. Free cash flow is the cash left over after capital expenditures, which can be used to pay dividends, repurchase shares, or pay down debt.
The RMR Group Inc. (RMR) spent $3.6M on capital expenditures in 2025. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.
In 2025, The RMR Group Inc. (RMR) returned $30.3M to shareholders via cash dividends and spent $0.9M on share repurchases. This shows the company's commitment to returning capital to its equity investors.
Key Metrics
Top Statement Risk
FFO and AFFO volatility
Metrics are mathematically derived from official filings.
FFO Cash Conversion Highly Erratic
The relationship between GAAP operating cash flow and FFO has been highly inconsistent, with OCF ranging from -$5.7M to $48.8M over the last ten quarters while FFO remained positive, suggesting significant non-cash adjustments and timing differences distort the cash conversion profile.
The extreme volatility in OCF, including a negative quarter in 2024Q4, contrasts with the relative stability of FFO, indicating that GAAP cash flow is heavily influenced by working capital swings and non-recurring items unrelated to core property operations. This disconnect implies that investors should rely on FFO and AFFO as the primary earnings metrics, as the GAAP cash flow figure provides limited insight into the recurring cash generation of the business.
AFFO Payout Coverage Tightens
Based on reported figures, the dividend payout ratio relative to AFFO has fluctuated significantly, reaching 141% in 2026Q2 and tightening to 98% in 2026Q3, indicating that the dividend is not consistently covered by the company's true distributable cash flow.
The inconsistent AFFO coverage of the dividend, with several quarters showing payout ratios above 100%, suggests the company may be relying on other sources of cash or drawing down reserves to maintain its distribution. The recent improvement to a near-100% payout in 2026Q3 is positive, but the historical pattern warrants monitoring to assess the sustainability of the dividend without external funding.
Depreciation Distorts GAAP Earnings
As reported in financial statements, the FFO-to-Net Income ratio has been highly volatile, ranging from 0.87 to 48.48 over the past ten quarters, highlighting how substantial non-cash depreciation charges consistently suppress GAAP net income relative to the REIT's core operating performance.
The wide swings in the FFO/NI ratio, particularly the extreme 48.48x reading in 2026Q2, indicate that GAAP net income is an unreliable indicator of RMR's economic earnings due to the magnitude of depreciation and likely other non-cash adjustments. This reinforces the necessity of using FFO and AFFO for valuation, as the GAAP figure is heavily distorted by accounting conventions that do not reflect the cash-generating ability of the real estate services business.
Working Capital Swings Mask Cash Trends
The significant divergence between GAAP operating cash flow and FFO, such as the $43.3M gap in 2026Q2, suggests large working capital adjustments are impacting reported cash collections and obscuring the underlying trend in fee-related revenue recognition.
The erratic pattern of OCF relative to FFO implies that timing of cash receipts, straight-line rent adjustments, or changes in tenant receivables are creating substantial quarterly noise. This volatility makes it difficult to assess the true cash collection efficiency from period to period and suggests that the reported revenue may not be translating into cash in a predictable manner.
Dividend Relies on Non-Operating Cash
In quarters where AFFO fell short of dividends paid, such as 2025Q2 and 2026Q2, the company appears to have funded the distribution gap using cash from operations that exceeded AFFO, indicating a dependency on non-recurring cash inflows or balance sheet liquidity.
The data shows that in several periods, dividends paid exceeded AFFO, yet the company maintained its distribution. This implies that the dividend is not solely supported by recurring, property-level cash flow and may be partially funded by other operational cash flows or a draw on accumulated cash balances. Investors should monitor whether this pattern persists, as it could signal a need for external capital if operating cash flows weaken.
What Could Invalidate the Base Case
The base case of stable cash flow generation is challenged by the persistent pattern of AFFO failing to cover dividends, which, as seen in 2026Q2's 141% payout ratio, suggests the dividend may be unsustainable without continued reliance on volatile non-recurring cash inflows or balance sheet draws.
A key risk is that the volatile OCF, which has swung from negative to highly positive, masks underlying weakness in recurring cash generation. If the large positive OCF swings are driven by non-recurring items or favorable working capital timing that does not repeat, the company could face a liquidity shortfall. Furthermore, the extreme volatility in FFO and AFFO themselves, with AFFO ranging from $2.7M to $15.8M in recent quarters, indicates that the core earnings stream is unstable, making it difficult to predict future distributable cash flow with confidence.