Analyst Marvin Fong from BTIG maintained a Buy rating on McGraw Hill, Inc. and keeping the price target at $22.00.
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Marvin Fong has given his Buy rating due to a combination of factors that, in his view, make the recent share price pullback unjustified and create an attractive entry opportunity. He believes the market overreacted to the CEO transition, noting that the outgoing CEO, Simon Allen, will remain as Chairman, which should help preserve strategic continuity and the momentum in market share gains and product innovation established under his leadership. Fong also emphasizes that McGraw Hill remains his top small- and mid-cap pick for the first half of 2026, supported by only modest revisions to his financial model despite the leadership change. Additionally, the repayment of a portion of the company’s term loan debt modestly adjusts his revenue and EBITDA forecasts but does not alter his positive view of the company’s fundamentals.
Fong views the incoming CEO, Philip Moyer, as particularly well-suited to lead the company through its next phase, given his deep background in AI, cloud computing, and prior CEO experience. He highlights Moyer’s successful track record at Vimeo, where shareholder value increased meaningfully during his tenure and culminated in an attractive acquisition, as evidence of his ability to execute and create value. Fong also notes Moyer’s earlier experience in education technology and his investing background as additional strengths that align with McGraw Hill’s business and strategic priorities. Based on these considerations, along with a valuation anchored on 8x his CY27 adjusted EBITDA estimate and a $22 price target, Fong concludes that the stock’s sell-off is overdone and supports a Buy recommendation.