RM (RM) AI Stock Analysis

• Market Cap: £109.52M
• Dividend Yield: N/A
• Average Volume (3M): 106.44K
• Price to Earnings (P/E): ―
• Beta (1Y): -0.21
• Revenue Growth: -14.23%
• EPS Growth: 97.27%
• Country: UK
• Employees: 1,644
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): -0.02
• Shares Outstanding: 98,085,540
• 10 Day Avg. Volume: 250,725
• 30 Day Avg. Volume: 106,442
• PEG Ratio: 0.16
• Price to Book (P/B): 3.81
• Price to Sales (P/S): 0.39
• P/FCF Ratio: 18.34
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: Hold
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 46 Neutral
• Price Target: 98.00p ▼(-13.27% Downside)

The overall stock score is primarily influenced by the company's weak financial performance, characterized by declining revenues and high leverage. Technical analysis provides some positive momentum signals, but valuation concerns due to negative profitability and lack of dividends weigh heavily on the score.

Positive Factors

Business Model Strength

RM's diversified revenue streams from software sales, subscriptions, and consultancy services provide resilience against market fluctuations and support long-term growth.

Market Position

As a leader in educational technology, RM benefits from a strong market position, allowing it to capitalize on growing demand for digital learning solutions.

Partnerships

Collaborations with educational bodies and tech firms expand RM's market reach and reinforce its competitive advantage, supporting sustainable revenue growth.

Negative Factors

Declining Revenues

The declining revenue trend poses a risk to RM's financial health, potentially impacting its ability to invest in growth and innovation.

High Leverage

High leverage can strain RM's cash flow and limit financial flexibility, posing challenges to long-term stability and operational efficiency.

Negative Profitability

Negative profitability reflects operational inefficiencies and may hinder RM's ability to sustain investments in product development and market expansion.

RM Business Overview & Revenue Model

Company Description

RM plc supplies products, services, and solutions to educational markets in the United Kingdom and internationally. The company operates through three divisions: RM Resources, RM Assessment, and RM Technology. The RM Resources division offers teaching resources and education supplies for schools and nurseries through direct sales force, online, and direct catalogue. The RM Assessment division provides IT software and end-to-end digital assessment services to enable online exam marking, online testing, and the management and analysis of educational data, as well as its software helps its customers accelerate their adoption of digital practices and transform assessment across practice, progress, evidence collection, and exams to unlock teaching and learning benefits. The RM Technology division provides IT services to schools and colleges to deliver a technology environment that improves learning outcomes. This division provides IT outsourcing services; cloud-based products; and digital platforms. RM plc was founded in 1973 and is headquartered in Abingdon, the United Kingdom.

How the Company Makes Money

RM generates revenue through several key streams, including the sale of educational software, digital learning resources, and consultancy services for schools and educational institutions. The company's primary revenue model is based on subscription fees for its software solutions and licenses for its digital content. Additionally, RM earns income from assessment services, including the management of examinations and certifications. Strategic partnerships with educational institutions, government bodies, and other stakeholders in the education sector further bolster its revenue, enabling RM to expand its market reach and enhance its offerings.

RM Financial Statement Overview

Summary

RM faces significant financial challenges, including declining revenues, negative profitability, and high leverage. While there are some improvements in cash flow, the company's financial health remains precarious. Strategic measures are needed to address operational inefficiencies and improve financial stability.

Income Statement

The company has experienced a declining revenue trend over the past few years, with a significant drop from 2022 to 2023. Gross profit margins have been relatively stable, but the net profit margin has turned negative, indicating profitability challenges. The EBIT and EBITDA margins have also deteriorated, reflecting operational inefficiencies.

Balance Sheet

The balance sheet shows a high debt-to-equity ratio, indicating potential leverage risks. Stockholders' equity has decreased significantly, affecting the equity ratio negatively. The return on equity is negative, highlighting profitability issues. The company's financial stability is concerning due to high liabilities relative to assets.

Cash Flow

The cash flow statement reveals some improvement in operating cash flow in the latest year, but free cash flow remains low. The free cash flow to net income ratio is positive, suggesting some ability to generate cash despite net losses. However, cash flow from operations has been inconsistent, indicating potential liquidity concerns.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	160.19M	166.14M	195.19M	214.17M	206.15M	189.00M
Gross Profit	64.86M	66.65M	60.19M	61.06M	59.04M	73.97M
EBITDA	1.81M	-1.32M	26.80M	-10.73M	11.24M	16.87M
Net Income	-1.27M	-4.74M	-29.10M	-14.50M	4.19M	7.63M
Balance Sheet
Total Assets	141.94M	138.50M	139.76M	202.65M	210.82M	172.37M
Cash, Cash Equivalents and Short-Term Investments	3.38M	8.20M	8.06M	1.91M	3.56M	5.94M
Total Debt	75.70M	74.82M	70.14M	67.87M	42.75M	29.47M
Total Liabilities	130.38M	121.39M	121.94M	142.01M	123.32M	116.99M
Stockholders Equity	11.56M	17.11M	17.83M	60.64M	86.97M	52.81M
Cash Flow
Free Cash Flow	7.60M	3.55M	-11.55M	-25.99M	-3.40M	12.64M
Operating Cash Flow	8.28M	8.37M	-10.46M	-20.79M	4.62M	21.10M
Investing Cash Flow	-6.89M	-4.72M	20.85M	891.00K	-12.59M	-3.98M
Financing Cash Flow	2.65M	-8.00M	-4.14M	20.29M	6.03M	-15.25M

RM Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 113.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:RM, the sentiment is Positive. The current price of 113 is above the 20-day moving average (MA) of 110.25, above the 50-day MA of 109.73, and above the 200-day MA of 102.33, indicating a bullish trend. The MACD of 0.65 indicates Negative momentum. The RSI at 57.90 is Neutral, neither overbought nor oversold. The STOCH value of 66.67 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:RM.

RM Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TRB	70 Outperform	£147.83M	18.30	15.34%	1.71%	3.48%	318.89%
OMG	69 Neutral	£54.43M	-54.83	-0.94%	7.26%	8.00%	-253.45%
AOM	68 Neutral	£162.82M	-803.57	-2.20%	―	31.86%	-115.22%
IGP	64 Neutral	£75.36M	19.76	23.08%	―	-19.19%	-41.12%
CLBS	62 Neutral	£53.11M	17.00	11.22%	2.44%	-25.63%	-20.36%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
RM	46 Neutral	£109.52M	-73.20	-3.40%	―	-14.23%	97.27%