MH Stock Forecast & Price Target

McGraw Hill's financial performance demonstrates a strong upward trajectory, with the Health segment reporting €1.58 billion in FY24 sales, reflecting a 5.0% year-over-year growth, supported by a robust adjusted operating profit margin of 30.3%. The Academic segment also showed notable resilience, with FY25 revenues increasing by 7% year-over-year and a substantial shift towards digital solutions, which constituted 91% of Higher Education sales. Furthermore, projections for FY25 indicate a consensus forecast of 16% sales growth alongside a significant improvement in Adjusted EBITDA margins, underscoring McGraw Hill's favorable positioning for sustained growth in the educational market.

McGraw Hill Inc. is facing a negative outlook due to projected total revenue falling within the range of $1,986-2,046 million, indicating a year-over-year decline of approximately 4.1% at the midpoint, particularly impacted by K-12 sector challenges. The company's EBITDA margin is anticipated to decline by 70 basis points year-over-year, primarily stemming from operating leverage issues tied to fluctuating K-12 purchasing cycles, which are exacerbated by a significant expected 20% drop in selling opportunities for FY26. Furthermore, K-12 revenues are estimated to decrease by 12% year-over-year in FY26, driven largely by a dramatic reduction in market opportunities in key states such as Florida, California, and Texas.