McGraw Hill, Inc. (MH)
NYSEConsumer StaplesEducation & Training ServicesSnapshot 2026-09-09
$12.28-3.69%
Close 2026-09-09 · 1-day change
NYSEConsumer StaplesEducation & Training ServicesSnapshot 2026-09-09
Intact: The reason to own it still holds.
McGraw Hill has raised its 2026 revenue guidance to about $2.03 billion. Analysts expect revenue growth near 4% next year. The company maintains a strong profit margin with a low PE of 5.23. It also announced a $50 million share buyback, showing confidence in cash flow.
Revenue fell 2% in the latest quarter and cash from operations dropped sharply to negative $146 million. The stock is down nearly 30% from its high, reflecting market doubts. Management's cash flow goals are not yet met, raising concerns about execution.
The price is about 30% below our fair value near $15, reflecting a cautious view. The market expects modest 4% revenue growth, which aligns with consensus but discounts some risks in cash flow and execution.
Breaks if: cash from operations remains negative over next 4 quarters
Focus on maintaining strong cash flow from operations to support business activities.
This is not a price target or investment advice.
A long-form read on the 1–3 year hold thesis. It updates when the weekly evidence changes.
This investment represents a long-term thesis on a company aiming for durable growth through revenue acceleration and AI integration. The current state reflects a cautious outlook due to sector headwinds and mixed recent performance.
The market appears to have priced in a neutral valuation, with expectations slightly below peers. The current valuation suggests that investors are not overly optimistic, but there is a gap in expectations that could influence future performance.
Management is on track with priorities to enhance revenue growth and margin expansion, as indicated by recent results. However, there is a near-term risk of earnings misses, given the company's erratic history.
The thesis hinges on several factors, including management's ability to maintain guidance, sector performance, and inflation trends. Positive momentum from sector peers could also play a crucial role in supporting MH's growth.
The most important moves since the prior daily snapshot.
Valuation rose by 12.8 points (from 65.0 to 77.8).
Yes, our read has strengthened. The company expects higher revenue for FY 2026. Global education spending is growing at 4.5% to 6.5% annually. This growth is up from about 2% before the pandemic. The company is expanding its AI-enabled learning tools and strategies. There are no new threats to the thesis.
as of 2026-09-09
Review the evidence to watch, what would become a concern, and what would make it less concerning.
Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.
Breaks if: YoY revenue growth falls below 4% in FY27
Management has revised the fiscal year 2026 revenue guidance upwards.
Breaks if: PE rises above 10 without earnings growth
In the next 1 to 3 years, MH's performance will depend on its execution of growth strategies and external economic conditions. Not investment advice.