QualityDipStocks / Consumer Discretionary · Publishing
McGraw Hill MH
Outside our quality screen, so we don’t track its dips. It’s 29% below its 52-week high.
Outside our quality screen, trading well below our fair value estimate, 8% under its Market Value.
Worth knowing
- FCF yield 14%, top 5% of the 1145 we measure
From the data on this page, as of the last close. How we pick these
- Fair value est.
- $28.73+125%
- Market Value
- $13.86price −8%
- Off 52-wk high
- −29%
- Risk vs market
- Lowbeta 0.16
5 bullish · 5 bearish See why
Priced in
How much growth the market assumed at the 52-week high, the low and today (a reverse DCF).
At the low ($9.10, Jul 22) about −12%; today about −11%. The last 3 years delivered 4%/yr (revenue).
Dashed line: what the last 3 years delivered, 4%/yr (revenue)
| Low | Now | |
|---|---|---|
| Price | $9.10Jul 22 | $12.78 |
| Implied growth | −12% | −11% |
| P/E | 47.3× | 26.4× |
| P/FCF | 6.8× | 7.3× |
| EV/Sales | 1.9× | 2.3× |
What this means: the higher the implied growth, the more the price already counts on. If today's number sits well below what the business has delivered, the market expects less than its track record.
How it’s computed
Reverse DCF: the same 10-year free-cash-flow model as our fair value estimate (9.5% discount rate, growth for years 1–5 fading to 3% by year 10, 3% after), solved for the growth that makes it equal the market value at each price. For the high and the low we use only the filings that were public on that day, so nothing from a later report leaks back. Market value = that close × diluted shares. P/E = market value / 12-month net income; Price / FCF = market value / 12-month free cash flow; EV / Sales = (market value + debt − cash) / 12-month revenue. Hidden when the share count moved over 20% (split, merger), free cash flow is negative, or the company reports in another currency.
Valuation
What we estimate it's worth, and how it ranks on value vs every stock we cover.
Fair value estimate
How the range is computed
Ten-year free-cash-flow DCF. Same 10-year free-cash-flow model as the base: discount rate 9.5% ±1 point and growth 3.6% ±2 points. Bear = 10.5% and 1.6%; bull = 8.5% and 5.6% (both fade to 3%). A model estimate from public filings, not a forecast of where the price will go.
Price is below even the bear case.
Cyclical / peak cash flow — treat with care
What the price implies To be worth today’s price, MH’s free cash flow would need to shrink about 11% a year for five years; our estimate uses 4%.
Risk vs market
How risk vs market is measured
One year of daily returns (Oct 31 to Nov 2, 252 sessions). Beta = how much MH moved for each 1% move in the S&P 500 (SPY); 1.0 moves with the market. Volatility is the yearly standard deviation of daily returns. Past behavior, not a forecast.
Has moved mostly independently of the market, but its own price swings are 4.7× the S&P 500’s (it moves on its own news).
- Beta vs S&P 500
- 0.16
- Volatility
- 60% vs 13% SPY
- Correlation SPY
- 0.03
- Correlation QQQ
- −0.08
How it ranks
Where MH stands vs every one of the 1,996 stocks we cover that has the number. Longer bar = better.
Top quarter on 2 of 6 measures
- Discount to fair value estimate125% · price below our base caseTop 6%of 1,314
- Free cash flow yield14% · free cash flow vs market capTop 4%of 1,391
- Dividends + buybacks yield0% · cash paid out or used to retire shares, vs market capLowest 1%of 1,836
- Revenue growth, last 12 months+0.1% · vs the 12 months beforeLowest 13%of 1,814
- Operating margin14% · of sales kept as operating profitTop 44%of 1,288
- Return on invested capital9.3% · profit per dollar of capitalLowest 45%of 838
From SEC filings and our fair value estimate model. A ranking, not advice.
Valuation details
DCF $28.73 · MV $13.86 · FCF value $45.26
Cyclical / peak cash flow — treat with care
Assumes 3.6% growth for 5 years (revenue grew 3.6% a year FY24–FY26), fading to 3%; 9.5% discount rate, 3% terminal growth. FCF base $1.76 a share (trailing 12 months to Jun 30, 2026), from the 10-Q filed Aug 13, 2026. Net debt $2.4B, not deducted.
Fundamentals
The business itself: sales, profits, cash and debt, from SEC filings.
Bull vs bear
Rule-based from the data on this page, strongest first. Not advice.
Top bullish points 5 of 5
ValuationFree-cash-flow yield of 13.7% (price / FCF 7.3×): $336M of free cash in the last 12 months.
ValuationOur DCF fair value estimate is $28.73, 125% above the price (cyclical or peak cash flow, so treat with care).
ProfitabilityOperating margin widened to 13.2% in FY2026 from 7.9% in FY2024 (SEC filings).
ProfitabilityReturn on equity of 17% over the last 12 months, up 57 points in two years.
ValuationTrades 7.8% below its Market Value of $13.86, the average price paid since the Oct 9 filing.
Top bearish points 5 of 5
Balance sheetNet debt of $2.4B, 97% of the market cap (Jun 30, 2026).
Cash returnsShare count up 14.8% in a year: existing holders are being diluted.
Balance sheetDebt is 3.2× shareholders’ equity.
Cash returnsFree cash flow fell 30% over the last 12 months vs the 12 months before.
QualityDoesn’t pass our quality screen: net debt 4.2× EBITDA (limit 3×).
All fundamentals
P/E 26.4 · FCF yield 13.7% · ROE 17%
Valuation
- P/E
- 26.4×Consumer Discretionary median 20.7×
- Price / FCF
- 7.3×
- FCF yield
- 13.7%
- EV / EBITDA
- 7.4×
- Price / sales
- 1.15×
- Price / book
- 3.10×
- Market cap
- $2.4Bprice × diluted shares
- Enterprise value
- $4.8B
Growth
- Revenue, 12 months
- $2.1B
- Sales growth, 12 months
- +0.1%vs the 12 months before
- Sales growth, 3 yrs
- +3.6%/yrfrom FY2024
- Diluted EPS, 12 months
- $0.49
- EPS growth, last FY
- n/afewer than two years of diluted EPS
- Net income, 12 months
- $93M
- Net income growth
- n/anot reported in its SEC filings
Profitability
- Gross margin
- 81.7%
- Operating margin
- 13.9%
- Net margin
- 4.4%
- FCF margin
- 15.9%
- Return on equity
- 17%
- Return on invested capital
- 9%
Balance sheet
- Cash & short-term inv.
- $194M
- Total debt
- $2.6B
- Net cash
- −$2.4B
- Debt / equity
- 3.25×
- Interest coverage
- n/ainterest expense not tagged in SEC data
Cash flow & returns
- Free cash flow, 12 months
- $336M
- FCF growth, 12 months
- −30%
- Dividend yield
- 0%
- Payout ratio
- n/anot reported in its SEC filings
- Buybacks, 12 months
- n/anot reported in its SEC filings
- Share count, 1 year
- +14.8%diluted shares vs a year ago
- Stock-based comp
- $38M
Trailing 12 months to Jun 30, 2026; balance sheet at Jun 30, 2026. From McGraw Hill’s SEC filings. Sparklines show up to six fiscal years. n/a means we don’t hold that number, with the reason. How each is computed.
The business
FCF $0.3B · Sales +3%
- Free cash flow, 12 months$0.3B
- Free-cash-flow yield13.7%
- Gross margin82%
- Operating margin22%
- Return on invested capital11%
- Return on equity17%
- Sales growth (latest quarter vs year-ago quarter)+3%
- Net debt / EBITDA4.2×
Chart & levels
Where the price is vs its key levels and trends.
Key levels
Every level vs today’s $12.78
- 52-wk lowlowest close, 1 year$9.10−28.8%
- PriceMon Nov 2 close$12.78you are here
- Market Valueavg paid since Oct 9$13.86+8.5%
- 52-wk highhighest close, 1 year$17.99+40.8%
- Fair value est.base case$28.73+124.8%
Momentum & 52-week range
RSI 40 · 5 days −11.5%
Signals
Reversal signal setups, the public ledger and the next earnings date.
Setup & signals
No setup armed
No setup armed, so there’s no trigger or stop to track yet. Reversal signal rules only run on companies that pass our quality screen.
Next report
Nov 5
- DateThu Nov 5, before the open
- Consensus EPS$0.70
- Year-ago EPS$1.40
- QuarterSep/2026
From Nasdaq’s earnings calendar. A report resets Market Value.
MH is outside our quality screen
One text when a published rule fires on one of the 332 quality companies we track: the ticker, the price, the stop and a link to the numbers. Nothing else.
Voices & buzz
Who is talking about it, and how it compares with peers.
Who’s talking about it
Notable investors, executives, analysts and public figures on McGraw Hill in the last 48 hours. Headlines as published, each linked. Their words, not ours.
No notable mentions in the last 48 hours. Checked Nov 3, 1:01 PM ET.
Compare with peers
Closest in size in Consumer Discretionary
Information only, not investment advice. Fair value estimates and talking points are rule-based model output from public data and can be wrong; stop levels are reference points, not orders. How every number is computed.