David Karnovsky, an analyst from J.P. Morgan, has initiated a new Buy rating on McGraw Hill, Inc. (MH).
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David Karnovsky has given his Buy rating due to a combination of factors that highlight McGraw Hill’s strong position in the education market and its potential for future growth. The company has successfully transitioned to a digital publishing model, utilizing real-time data analytics to enhance learning outcomes and drive customer retention. This digital shift, along with product innovation, positions McGraw Hill to capture significant market share and maintain a steady stream of recurring revenue.
Furthermore, McGraw Hill operates in a large and growing education market, with a focus on U.S. K-12 and higher education segments expected to grow steadily. The company’s strong competitive position is supported by its substantial base of digital users and its consistent market share gains. Financially, McGraw Hill is poised for substantial free cash flow generation and net debt reduction, making it an attractive investment. The stock is currently trading at a discount compared to its peers, providing a compelling entry point for investors as the company continues to execute its growth strategy and reduce leverage.
According to TipRanks, Karnovsky is a 5-star analyst with an average return of 12.5% and a 71.00% success rate. Karnovsky covers the Communication Services sector, focusing on stocks such as Cinemark Holdings, IMAX, and Walt Disney.
In another report released today, BMO Capital also initiated coverage with a Buy rating on the stock with a $24.00 price target.