McGraw Hill, Inc. (MH) AI Stock Analysis

• Market Cap: $2.08B
• Dividend Yield: N/A
• Average Volume (3M): 852.21K
• Price to Earnings (P/E): ―
• Beta (1Y): -0.58
• Revenue Growth: 3.19%
• EPS Growth: -6.25%
• Country: US
• Employees: 4,200
• Sector: Consumer Defensive
• Sector Strength: 42
• Industry: Education & Training Services
• EPS (TTM): 1.40
• Shares Outstanding: 191,001,530
• 10 Day Avg. Volume: 531,689
• 30 Day Avg. Volume: 852,213
• PEG Ratio: 0.68
• Price to Book (P/B): 11.59
• Price to Sales (P/S): 1.55
• P/FCF Ratio: 6.69
• 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: $20.00
• Price Target Upside: 16.75% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 9
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 54 Neutral
• Price Target: $18.50 ▲(8.00% Upside)

The overall stock score is driven by strong earnings call performance and strategic improvements, particularly in digital and Higher Education segments. However, financial risks due to high leverage and profitability challenges, along with overbought technical indicators, weigh down the score.

Positive Factors

Higher Education Revenue Growth

The significant growth in Higher Education revenue and digital expansion indicates strong market position and demand, supporting long-term growth.

Digital Revenue Expansion

Increasing digital revenue reflects successful adaptation to digital trends, enhancing competitive advantage and future revenue stability.

Debt Reduction

Strategic debt reduction improves financial health, reducing interest burden and enhancing cash flow for future investments.

Negative Factors

High Leverage

High leverage can limit financial flexibility and increase risk, potentially impacting long-term operational stability.

Negative Free Cash Flow Growth

Negative free cash flow growth suggests cash management issues, which could constrain future investments and operational capabilities.

K-12 Revenue Decline

Declining K-12 revenue indicates challenges in this segment, potentially affecting overall growth and market diversification.

McGraw Hill, Inc. Business Overview & Revenue Model

Company Description

McGraw Hill, Inc. is a leading educational content and technology company that provides innovative learning solutions across various sectors, including K-12 education, higher education, and professional learning. The company offers a wide range of products and services, including textbooks, digital learning platforms, assessment tools, and educational software, aimed at enhancing the teaching and learning experience. With a strong focus on leveraging technology, McGraw Hill integrates digital resources and analytics into its offerings, making education more accessible and effective for students and educators alike.

How the Company Makes Money

McGraw Hill generates revenue primarily through the sale of educational materials and services across its various sectors. Key revenue streams include the sale of print and digital textbooks, subscription services for digital learning platforms, and licensing fees for educational content. Additionally, the company earns money from assessment products and services, including standardized testing solutions. McGraw Hill also engages in strategic partnerships with educational institutions and technology providers, which can enhance its product offerings and expand its market reach, contributing further to its earnings. The ongoing transition towards digital learning solutions and the increasing demand for educational technology also play a significant role in driving the company's revenue growth.

McGraw Hill, Inc. Financial Statement Overview

Summary

McGraw Hill, Inc. shows strong revenue growth but struggles with profitability and high leverage. The negative net profit margin and high debt-to-equity ratio indicate financial risks, while cash flow metrics are mixed, with improved operating cash flow but negative free cash flow growth.

Income Statement

McGraw Hill, Inc. has shown significant revenue growth of 401.14% in the latest year, indicating strong top-line expansion. However, the company is struggling with profitability, as evidenced by a negative net profit margin of -4.09%. The EBIT and EBITDA margins are relatively healthy at 14.60% and 31.85%, respectively, suggesting operational efficiency despite net losses.

Balance Sheet

The company has a high debt-to-equity ratio of 11.62, indicating significant leverage and potential financial risk. The negative return on equity of -30.63% reflects ongoing challenges in generating returns for shareholders. The equity ratio is low, suggesting limited equity financing relative to total assets.

Cash Flow

Operating cash flow has improved, with a coverage ratio of 0.49, indicating better cash generation relative to net income. However, free cash flow growth is negative at -442.06%, highlighting potential cash flow challenges. The free cash flow to net income ratio is 0.75, showing some ability to convert earnings into cash.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023
Income Statement
Total Revenue	1.68B	2.10B	1.96B	1.95B
Gross Profit	1.34B	1.68B	1.54B	1.48B
EBITDA	544.04M	669.16M	571.18M	495.71M
Net Income	-51.08M	-85.84M	-193.02M	-404.10M
Balance Sheet
Total Assets	6.05B	5.76B	5.81B	6.07B
Cash, Cash Equivalents and Short-Term Investments	463.19M	389.83M	203.62M	181.47M
Total Debt	2.88B	3.26B	3.53B	3.59B
Total Liabilities	5.25B	5.48B	5.44B	5.51B
Stockholders Equity	794.59M	280.24M	368.75M	558.13M
Cash Flow
Free Cash Flow	8.91M	485.22M	79.55M	116.06M
Operating Cash Flow	127.15M	646.28M	236.16M	256.62M
Investing Cash Flow	-150.52M	-167.06M	-136.11M	-162.32M
Financing Cash Flow	-63.13M	-294.68M	-77.24M	-204.57M

McGraw Hill, Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EDU	70 Outperform	$8.29B	22.26	9.28%	1.14%	7.22%	-2.84%
LOPE	68 Neutral	$4.38B	21.11	27.77%	―	7.05%	-2.63%
TAL	67 Neutral	$6.73B	37.90	4.77%	―	44.57%	147.78%
COUR	63 Neutral	$1.31B	―	-7.43%	―	8.10%	43.35%
Sector *	62 Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%
UDMY	60 Neutral	$740.67M	―	-1.78%	―	2.53%	95.79%
MH	54 Neutral	$2.08B	-27.46	―	―	3.19%	-6.25%

McGraw Hill, Inc. Corporate Events

McGraw Hill’s Earnings Call: Strong Growth Amid Challenges

The recent earnings call for McGraw Hill, Inc. painted a picture of robust performance in several key areas, particularly in Higher Education and digital revenue growth. The company demonstrated strategic financial management through debt reduction and cash flow improvements. However, challenges were noted in the K-12 segment and international markets, though these were anticipated and aligned with expectations.

McGraw Hill Reports Strong Q2 2026 Results

McGraw Hill, Inc. is a leading global provider of educational solutions, catering to a wide range of learners from preK-12 through higher education and professional learning, known for its innovative and personalized learning experiences. In its fiscal second quarter of 2026, McGraw Hill reported strong financial performance despite a challenging market environment, with notable growth in digital and re-occurring revenues. The company achieved a revenue of $669.2 million, a slight decline from the previous year due to a smaller K-12 market, but this was offset by significant growth in higher education. Digital revenue increased by 7.6%, and re-occurring revenue grew by 6.5%, highlighting the company’s robust digital strategy and scalable business model. McGraw Hill’s gross profit margin improved to 79.2%, and the adjusted EBITDA margin expanded to 42.8%, reflecting the company’s efficient operations and strategic investments in AI-powered solutions. Looking ahead, McGraw Hill’s management remains optimistic about future growth, driven by continued innovation and market share gains, particularly in higher education, positioning the company well for sustained value creation for its stakeholders.

McGraw Hill Announces $150 Million Loan Prepayment

On October 16, 2025, McGraw Hill, Inc. announced a $150 million prepayment of its term loan, reducing the outstanding balance to approximately $618 million. This move is part of the company’s ongoing efforts to deleverage and strengthen its financial position, resulting in expected annualized cash interest savings of over $40 million. The company emphasizes its commitment to financial discipline and achieving a net leverage target of 2-2.5x, reflecting the strength of its business and strategic focus on debt reduction.

The most recent analyst rating on (MH) stock is a Hold with a $15.00 price target. To see the full list of analyst forecasts on McGraw Hill, Inc. stock, see the MH Stock Forecast page.

McGraw Hill Amends Credit Agreement to Reduce Rates

On September 8, 2025, McGraw-Hill Education, Inc., a subsidiary of McGraw Hill, Inc., amended its Credit Agreement to reduce the interest rate by 50 basis points, with a potential further reduction of 25 basis points based on credit ratings. This repricing follows the company’s initial public offering in July 2025, where it prepaid $385 million of its term loan, reducing annualized interest expenses by over $30 million. The move is part of McGraw Hill’s strategy to optimize its capital structure and strengthen its balance sheet by reducing debt and cash interest obligations.

The most recent analyst rating on (MH) stock is a Buy with a $19.00 price target. To see the full list of analyst forecasts on McGraw Hill, Inc. stock, see the MH Stock Forecast page.

McGraw Hill Plans Repricing of Term Loan Facility

McGraw Hill, Inc. announced plans to amend its senior secured first lien term loan facility due 2031 to reprice the existing term loans. A meeting with lenders is scheduled for September 2, 2025, to discuss this repricing transaction, which is contingent on market conditions and may not proceed as planned. This move could impact the company’s financial strategy and market positioning, potentially affecting stakeholders involved in the credit agreement.

The most recent analyst rating on (MH) stock is a Buy with a $19.00 price target. To see the full list of analyst forecasts on McGraw Hill, Inc. stock, see the MH Stock Forecast page.