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McGraw Hill, Inc.
(NYSE:MH)
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Rating:68Neutral
Price Target:
$15.00
▲(13.38% Upside)
Action:Reiterated
Date:09/25/26
The score is driven primarily by improving financial performance (profitability and free cash flow recovery) but held back by still-high leverage. Technicals add support with a clear uptrend, while valuation is a modest headwind due to a higher P/E and no dividend yield. The earnings call reinforces the improving trajectory via reaffirmed guidance, stronger recurring/digital mix, and continued balance-sheet progress, with timing/seasonality the key near-term risk.
Positive Factors
Recurring and Digital Mix
The growing share of recurring and digital revenue makes McGraw Hill’s business more predictable than a print-led model based mainly on one-time purchases. Subscription-like access can support retention, improve revenue visibility, and create a durable base for continued product investment and margin expansion.
Negative Factors
Elevated Leverage
Leverage remains high relative to the company’s equity base, limiting financial flexibility even after substantial improvement. Debt obligations can absorb cash that might otherwise fund innovation, acquisitions, or shareholder returns, while leaving McGraw Hill more exposed to execution setbacks and refinancing requirements.
Read all positive and negative factors
Positive Factors
Negative Factors
Recurring and Digital Mix
The growing share of recurring and digital revenue makes McGraw Hill’s business more predictable than a print-led model based mainly on one-time purchases. Subscription-like access can support retention, improve revenue visibility, and create a durable base for continued product investment and margin expansion.
Read all positive factors
McGraw Hill, Inc. (MH) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.44B
Dividend YieldN/A
Average Volume (3M)577.97K
Price to Earnings (P/E)27.1
Beta (1Y)0.21
Revenue Growth0.14%
EPS GrowthN/A
CountryUS
Employees4,400
SectorGeneral
Sector StrengthN/A
IndustryEducation & Training Services
Share Statistics
EPS (TTM)0.47
Shares Outstanding191,308,800
10 Day Avg. Volume588,693
30 Day Avg. Volume577,967
Financial Highlights & Ratios
PEG Ratio-0.51
Price to Book (P/B)3.46
Price to Sales (P/S)1.20
P/FCF Ratio10.20
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$17.57Price Target Upside32.82% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering8
EPS Forecast (FY)1.97
Revenue Forecast (FY)$2.15B
McGraw Hill, Inc. Business Overview & Revenue Model
Company Description
McGraw Hill, Inc., known as McGraw Hill, delivers educational resources to students and professionals across primary (K-12), higher education, and specialized professional sectors, both domestically in the United States and internationally. The co...
How the Company Makes Money
McGraw Hill primarily makes money by selling education products and services to institutions and learners, with revenue historically generated through a mix of print and digital channels. Key revenue streams include: (1) digital learning platforms...
McGraw Hill, Inc. Earnings Call Summary
Earnings Call Date:Aug 13, 2026
(Q1-2027)
| % Change Since: |
Next Earnings Date:Nov 18, 2026
Earnings Call Sentiment Positive
The call presented a predominately positive operational and financial picture: revenue and profitability beat expectations, recurring and digital revenue mix strengthened, higher education market share and Inclusive Access/Evergreen momentum were highlighted, AI and medical initiatives showed early traction, and substantial gross debt reduction improved the balance sheet. Most negatives were timing, seasonality, or one-time items (shipment delays in the Middle East, non‑recurring IP sale, and continued dependence on fall enrollment and K‑12 award timing). Given the breadth of tangible wins, margin expansion, and balance-sheet improvement — with the remaining risks largely timing or visibility related — the overall tone is constructive.Positive Updates
Revenue and Profitability Outperformance
Total revenue $550 million, up 2.6% year-over-year; adjusted EBITDA $207 million with a 37.7% margin (increase of 192 basis points YoY); net income $58 million. Recurring revenue $426 million, up ~9.8% YoY and representing 77% of total revenue.
Negative Updates
Modest Overall Revenue Growth
Total revenue growth was modest at 2.6% YoY and K-12 growth was only 1.3% YoY, indicating limited top-line acceleration despite segment-level wins.
Read all updates
Q1-2027 Updates
Positive
Negative
Revenue and Profitability Outperformance
Total revenue $550 million, up 2.6% year-over-year; adjusted EBITDA $207 million with a 37.7% margin (increase of 192 basis points YoY); net income $58 million. Recurring revenue $426 million, up ~9.8% YoY and representing 77% of total revenue.
Read all positive updates
Company Guidance
McGraw Hill reaffirmed its fiscal 2027 guidance across all metrics ahead of the primary back‑to‑school selling season, while embedding an assumption of 1% enrollment growth and cautioning that adjusted EBITDA can shift between Q1 and Q2 due to academic seasonality (they therefore focus on first‑half results); Q1 results that support the outlook included $550 million of revenue (+2.6% YoY) with recurring revenue $426 million (+9.8%, 77% of total), digital revenue ~64% of total (+~9% YoY), adjusted EBITDA of $207 million (37.7% margin, +192 bps YoY), remaining performance obligation of $1.5 billion, cash of $194 million and total liquidity of $644 million, plus FY2026 gross debt reduction of $646 million (cutting annualized cash interest by ~$45 million), a net‑leverage target of 2.0–2.5x, and a $50 million share‑repurchase authorization while continuing to pursue organic reinvestment and select tuck‑in M&A.McGraw Hill, Inc. Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
46
Neutral
Cash Flow
67
Positive
| Breakdown | TTM | Mar 2026 | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.12B | 2.10B | 2.10B | 1.96B | 1.95B | 1.79B |
| Gross Profit | 1.73B | 1.70B | 1.68B | 1.54B | 1.48B | 1.37B |
| EBITDA | 573.36M | 677.70M | 669.16M | 571.18M | 495.71M | 335.69M |
| Net Income | 92.68M | 35.32M | -85.84M | -193.02M | -404.10M | -674.25M |
Balance Sheet | ||||||
| Total Assets | 5.38B | 5.49B | 5.76B | 5.81B | 6.07B | 6.59B |
| Cash, Cash Equivalents and Short-Term Investments | 193.64M | 253.52M | 389.83M | 203.62M | 181.47M | 296.37M |
| Total Debt | 2.65B | 2.65B | 3.26B | 3.53B | 3.59B | 3.70B |
| Total Liabilities | 4.59B | 4.76B | 5.48B | 5.44B | 5.51B | 5.64B |
| Stockholders Equity | 788.39M | 726.22M | 280.24M | 368.75M | 558.13M | 948.95M |
Cash Flow | ||||||
| Free Cash Flow | 358.71M | 246.31M | 575.22M | 79.55M | 116.06M | 175.04M |
| Operating Cash Flow | 428.43M | 331.17M | 646.28M | 236.16M | 256.62M | 205.69M |
| Investing Cash Flow | -223.08M | -203.86M | -167.06M | -136.11M | -162.32M | -5.32B |
| Financing Cash Flow | -260.63M | -264.87M | -294.68M | -77.24M | -204.57M | 5.06B |
McGraw Hill, Inc. Technical Analysis
Neutral
13.23
Price Trends
12.20
Positive
11.62
Positive
12.99
Negative
Market Momentum
0.26
Positive
48.07
Neutral
56.91
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MH, the sentiment is Neutral. The current price of 13.23 is above the 20-day moving average (MA) of 13.04, above the 50-day MA of 12.20, and above the 200-day MA of 12.99, indicating a neutral trend. The MACD of 0.26 indicates Positive momentum. The RSI at 48.07 is Neutral, neither overbought nor oversold. The STOCH value of 56.91 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for MH.
McGraw Hill, Inc. Risk Analysis
McGraw Hill, Inc. disclosed 60 risk factors in its most recent earnings report. McGraw Hill, Inc. reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
McGraw Hill, Inc. Peers Comparison
UnderperformOutperform
Sector (55)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $5.78B | 2.42 | 24.59% | 0.41% | 32.55% | 846.04% | |
74 Outperform | $8.87B | 19.16 | 11.94% | 2.13% | 15.64% | 32.37% | |
70 Outperform | $3.84B | 17.70 | 31.24% | ― | 6.97% | 0.18% | |
68 Neutral | $2.44B | 27.09 | 12.02% | ― | 0.14% | ― | |
63 Neutral | $1.34B | -7.09 | -17.74% | ― | 22.69% | -112.56% | |
55 Neutral | $6.65B | 3.83 | -15.92% | 6.20% | 10.91% | 7.18% |
* General Sector Average
MH
McGraw Hill, Inc.
12.73
-0.96
-7.01%
LOPE
Grand Canyon Education
147.28
-70.59
-32.40%
EDU
New Oriental Education Tech
56.47
4.05
7.73%
TAL
TAL Education Group
12.00
0.73
6.48%
COUR
Coursera
5.05
-7.02
-58.16%
McGraw Hill, Inc. Corporate Events
Business Operations and StrategyPrivate Placements and Financing
McGraw Hill Announces Major 2033 Debt Refinancing Plan
Positive
Sep 25, 2026
On September 25, 2026, McGraw Hill, Inc. announced that its subsidiary McGraw-Hill Education, Inc. plans a private offering of $500 million in senior secured notes due 2033, guaranteed by its parent and certain subsidiaries. The issuer also intend...
Business Operations and StrategyFinancial DisclosuresShareholder Meetings
McGraw Hill Reports Strong Fiscal Q1 2027 Results
Positive
Aug 13, 2026
On August 11, 2026, McGraw Hill held its virtual annual meeting of stockholders, who elected four directors to serve until the 2029 annual meeting, approved on an advisory basis the compensation of named executive officers, set annual advisory vot...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.