Earnings quality appears strained as evidenced by an OCF/NI ratio of 15.08x in 2026Q2, suggesting that reported net income of $3.2 million is heavily reliant on working capital fluctuations.
| 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 | 97.32M | 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 Margin % | - | 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% |
| Operating CF Growth % | 563% | 23.42% | -43.8% | 7.85% | 41.06% | -7.36% | -60.9% | -13.24% | 81.42% | 27.43% | -3.19% | 222.21% | 416.99% | - |
| Net Income | 23.03M | 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 | 15.88M | 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 |
| Deferred Taxes | 1.48M | 1.98M | 3.06M | -1.11M | 1.56M | 5.23M | 1.83M | -3K | 19.82M | 278K | 795K | 0 | 0 | 0 |
| Other Non-Cash Items | 18.07M | 11.78M | 6.12M | -23.77M | 1.82M | -6.32M | 9.39M | 14.76M | -11.24M | 11.06M | 10.68M | -4.62M | -7.75M | -1.34M |
| Working Capital Changes | 17.3M | 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 |
| Change in Receivables | 7.41M | 54.61M | -14.36M | 0 | -18.72M | -4.28M | 10.4M | -64.85M | -3.74M | -366K | -6.3M | 26.23M | -19.49M | 21.41M |
| Change in Inventory | 0 | 0 | 0 | 0 | 18.72M | 0 | 0 | 64.85M | 0 | 0 | 0 | -39.66M | 0 | 638K |
| Change in Payables | -36.72M | -40.66M | 10.2M | -4K | 1.55M | -2.68M | -3.57M | 70M | 3.14M | 6.38M | -2.47M | 287K | 5.48M | 2.32M |
| Cash from Investing | -140.44M | -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 |
| Capital Expenditures | -5.29M | -3.65M | -3.87M | -3.98M | -1.12M | -1.14M | -601K | -702K | -648K | -827K | -1.07M | -1.4M | -1.42M | -2.96M |
| CapEx % of Revenue | 0.83% | 0.52% | 0.43% | 0.41% | 0.13% | 0.19% | 0.1% | 0.1% | 0.16% | 0.3% | 0.4% | 0.73% | 0.5% | 1.14% |
| Acquisitions | 0 | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Investments | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Other Investing | -169.16M | -166.36M | -126.99M | 0 | -9.47M | 0 | 0 | 14.03M | 0 | -12M | -2.48M | 1.33M | 1.23M | 1.1M |
| Cash from Financing | -13.96M | 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 |
| Debt Issued (Net) | 0 | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Equity Issued (Net) | -955K | -903K | -1.14M | -734K | -547K | -834K | -523K | -827K | -987K | -358K | -91K | 57.91M | 0 | 0 |
| Dividends Paid | -30.54M | -30.35M | -28.42M | -26.58M | -25.73M | -139.78M | -24.79M | -22.73M | -16.17M | -16.09M | -17.21M | -224.34M | 0 | 0 |
| Share Repurchases | -955K | -903K | -1.14M | -734K | -547K | -834K | -523K | -827K | -987K | -358K | -91K | 0 | 0 | 0 |
| Other Financing | -36.05M | -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 | -57.08M | -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 |
| Free Cash Flow | 92.03M | 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 Margin % | 14.37% | 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% |
| FCF Growth % | 52.79% | 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 per Share | 5.49 | 4.33 | 3.48 | 3.34 | 3.19 | 2.26 | 2.47 | 12.24 | 14.13 | 7.80 | 6.11 | 6.29 | 1.89 | 0.20 |
| FCF Conversion (FCF/Net Income) | 4.00x | 4.30x | 2.65x | 1.91x | 2.98x | 2.01x | 2.69x | 1.17x | 2.38x | 2.98x | 2.65x | 13.98x | 3.08x | -0.19x |
| Interest Paid | 3.44M | 6.4M | 371K | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 144K | 0 |
| Taxes Paid | -3.81M | 5.74M | 9.14M | 21.23M | 9.55M | 10.05M | 10.19M | 29.62M | 37.65M | 27.77M | 25.81M | 217K | 104K | 0 |
Captive REIT fee erosion
As reported in financial statements, RMR's operating cash flow frequently dwarfs net income, with the OCF/NI ratio reaching an extreme 15.08x in 2026Q2, suggesting that reported earnings are a poor proxy for the actual cash-generating capacity of the firm's underlying management platform.
The persistent divergence between net income and operating cash flow indicates that non-cash charges or significant working capital swings are heavily influencing the bottom line. Investors should monitor whether this gap represents sustainable cash generation or merely timing differences in fee recognition that may not repeat.
Based on RMR's reported figures, free cash flow has exhibited extreme volatility, swinging from a negative $6.9 million in 2024Q4 to a peak of $46.1 million in 2026Q2, highlighting the sensitivity of cash generation to the timing of incentive fees and operational expenses.
The erratic nature of FCF margins suggests that RMR's cash flow profile is highly dependent on non-recurring events rather than a steady, predictable stream of management fees. This inconsistency complicates valuation efforts and may indicate that the firm's core business model is struggling to maintain consistent cash conversion.
According to recent SEC filings, RMR's operating cash flow is heavily impacted by working capital fluctuations, such as the $34.8 million inflow in 2026Q2, which appears to be the primary driver of recent cash accumulation rather than organic growth in management fee revenue.
The reliance on working capital movements to bolster cash flow suggests that the firm's operational efficiency is currently secondary to balance sheet management. Analysts should investigate whether these inflows are sustainable or if they represent a temporary deferral of liabilities that could reverse in future periods.
Based on historical data, RMR consistently utilizes cash to fund dividends of approximately $7.6 million per quarter, a commitment that appears increasingly strained as the firm's core fee-earning assets face structural headwinds and potential declines in managed REIT equity market capitalization.
While the firm maintains a conservative debt profile, the use of cash for dividends while operating margins remain thin warrants caution. If the captive REITs continue to face liquidity issues, the sustainability of this capital return policy may be challenged by the need to preserve cash for operational stability.
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.