McGraw Hill Inc
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McGraw Hill Inc AI Insights
Informational only. Not investment advice.Snapshot
- Goodwill of 2.6B is 322% of equity (795M) - tangible book value is negative 3.3B, creating material impairment risk[Goodwill]
- Gross margin 80.6% TTM vs industry median 55.3% - 25pp advantage reflects pricing power in educational content[Gross Margin TTM]
- Debt/equity 3.6x with net loss of 104M TTM - interest burden consuming operating income despite 305M EBIT[Debt to Equity]
Watch Triggers
- Free Cash Flow TTM: Falls below 150M annually — Debt service requires sustained FCF - drop signals refinancing risk on 2.9B debt
- Goodwill: Impairment charge announced — 795M equity could be wiped out by write-down of 2.6B goodwill
- Operating Margin TTM: Drops below 10% — Margin compression would eliminate debt service cushion
Bull Case
80.6% gross margin with 662M EBITDA TTM provides debt service capacity - FCF of 222M enables continued deleveraging from 391M net repayment pace
Revenue 2.1B is 2.5x industry median with operating margin 14.5% above 10.3% median - scale advantages in fragmented education market
Bear Case
Net loss 104M TTM despite 305M operating income - 2.9B debt burden generating interest expense exceeding operating profits
Negative tangible book value of -3.3B with goodwill 322% of equity - any impairment directly erodes thin equity cushion of 795M
Bull vs Bear Balance
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Forward Thesis
Deleveraging trajectory will determine equity value over next 1-3 years
- FCF of 222M TTM can service 2.9B debt
- Net debt repayment of 391M shows commitment
- Operating cash flow 402M provides cushion
Margin compression risk if digital transition accelerates capex needs
- R&D spend 293M (14% of revenue)
- Capex 180M already elevated vs peers
- Inventory 133M suggests print exposure
Valuation Context
Caveats
MH Fundamentals
| Metric | Value | YoY Growth | Industry Percentile |
|---|---|---|---|
$1.85B | — | ||
$4.24B | — | ||
51 | — | ||
$2.1B | +0.1% | — | |
$0.19 | — | ||
15.0% | +0.4% | — | |
1.68% | +5.8% | — | |
$127.31M | -73.8% | — | |
7.02% | +33.5% | — | |
Beta 5Y (Monthly) | unknown | — |
MH Dividend History
MH Stock Splits
MH SEC Filings
| Filing Date | Report Date | Report Type | Filing Link |
|---|---|---|---|
06/11/26 | 03/31/26 | 10-K | |
02/11/26 | 12/31/25 | 10-Q | |
11/12/25 | 09/30/25 | 10-Q | |
08/14/25 | 06/30/25 | 10-Q | |
07/24/25 | 03/31/25 | 424B4 | |
03/13/25 | 12/31/24 | DRS/A | |
11/12/25 | 09/30/24 | 10-Q | |
08/14/25 | 06/30/24 | 10-Q | |
03/13/25 | 03/31/24 | DRS/A | |
03/13/25 | 12/31/23 | DRS/A | |
09/13/23 | 06/30/23 | DRS/A | |
07/17/25 | 03/31/23 | S-1/A | |
09/13/23 | 03/31/23 | DRS/A | |
03/08/23 | 12/31/22 | DRS/A | |
12/22/22 | 09/30/22 | DRS/A | |
11/04/22 | 06/30/22 | DRS | |
03/08/23 | 03/31/22 | DRS/A | |
03/08/23 | 12/31/21 | DRS/A | |
09/30/21 | 09/30/21 | Unknown | -- |
11/04/22 | 06/30/21 | DRS |