Is MH a Buy? What to Consider in 2026
Last updated July 2026
Short answer
The bull case for McGraw Hill (MH) rests on Shift to recurring digital revenue: Recurring, or re-occurring, revenue reached about $1.54 billion in fiscal 2026, up roughly 6% and more than 73% of total revenue, while digital revenue climbed to about $1.43 billion. Revenue (FY2026, ended March 2026) is ~$2.10B (+0.1% YoY). If you believe that thesis holds, the real questions become position sizing and overlap, not timing. The main risk to that view: McGraw Hill still carries meaningful debt from its private-equity ownership, so a large share of operating cash flow goes to interest and principal rather than shareholders, and rising rates or a stumble in growth would pressure the equity. Whether MH is a buy comes down to whether you believe the thesis. This is informational, not a recommendation, and Walnut is not an investment adviser.
McGraw Hill, Inc. is a global education company that provides curriculum, courseware, assessments, and adaptive-learning platforms across K-12 schools, higher education, and professional and international markets. It has moved well beyond its textbook roots: digital products such as its ALEKS adaptive-learning system and Connect courseware now drive the majority of revenue, and management emphasizes recurring subscription and licensing income over one-time print sales. The company was taken private by Apollo Global Management in 2013, merged plans with Cengage were abandoned, and it returned to the public market with a July 2025 IPO on the NYSE at $17 per share. The investment picture centers on a digital-subscription transition paired with balance-sheet repair. In fiscal 2026 (year ended March 31, 2026), roughly 73% of revenue was recurring and digital revenue grew mid-single digits, while the company returned to positive net income and cut a large chunk of debt. The counterweight is leverage inherited from the Apollo era, slow overall top-line growth, exposure to school and college budget cycles, and competition from both traditional publishers and free open educational resources. For investors, MH is a moderate-growth, cash-generative content business whose equity return depends heavily on how fast it can pay down debt and expand its digital, recurring mix.
What's the case for buying MH?
1. Shift to recurring digital revenue
Recurring, or re-occurring, revenue reached about $1.54 billion in fiscal 2026, up roughly 6% and more than 73% of total revenue, while digital revenue climbed to about $1.43 billion. This mix shift replaces lumpy print adoption cycles with steadier subscription and licensing income. A higher recurring share tends to make revenue more predictable and can support a richer valuation over time.
2. Higher Education momentum and AI features
Higher Education has been the standout, with segment revenue growing double digits in recent quarters as students adopt digital courseware. Management is embedding generative-AI study tools and tutoring features into platforms like Connect and ALEKS. Success here is central to offsetting slower or more budget-dependent K-12 sales.
3. Deleveraging and early capital return
The company reduced gross debt by roughly $646 million in fiscal 2026 and ended the year with a net leverage ratio near 3.2 times, targeting a longer-run range of 2 to 2.5 times. It also authorized a $50 million share buyback after returning to positive net income. Lower interest expense from paying down debt flows directly toward the bottom line.
4. Scale and entrenched school relationships
McGraw Hill is one of a small handful of at-scale providers spanning K-12, higher education, and professional learning, with deep institutional relationships and large content libraries. That breadth creates switching costs for schools and universities that standardize on its platforms. This installed base underpins the recurring revenue that management is trying to grow.
What are the risks to MH?
McGraw Hill still carries meaningful debt from its private-equity ownership, so a large share of operating cash flow goes to interest and principal rather than shareholders, and rising rates or a stumble in growth would pressure the equity. Overall revenue growth has been roughly flat, with strength in Higher Education offset by softer K-12 and international results that depend on school-district and government budgets. The industry faces structural pressure from free open educational resources, used-book and rental markets, and enrollment declines in parts of US higher education. Competition is intense from Pearson, Cengage, and Houghton Mifflin Harcourt, and increasingly from large technology firms building AI tutors and content. The stock has traded well below its $17 IPO price, and as a recently public, controlled company it carries limited trading history and concentrated ownership.
How is MH valued? (as of JULY 2026)
Snapshot for MH as of July 2026, sourced from Yahoo Finance and may be delayed. Valuation figures move with price and earnings; verify the current numbers with your broker before deciding.
- Revenue (FY2026, ended March 2026): ~$2.10B (+0.1% YoY)
- Recurring revenue: ~$1.54B (+5.8%, ~73% of total)
- Adjusted EBITDA: ~$744M (~35% margin)
- Net income (FY2026): ~$35M (from a prior-year loss)
- Net leverage ratio: ~3.2x (target 2.0-2.5x)
- Market cap: ~$1.9B
McGraw Hill trades at a market cap below its annual revenue, reflecting both its debt load, which sits ahead of shareholders, and modest overall top-line growth. The trailing P/E has been elevated near 50 times because net income only recently turned positive, so investors have leaned on EV/EBITDA and free cash flow instead. The stock traded around $9 to $10 in mid-July 2026, well below its $17 July 2025 IPO price, within a 52-week range of roughly $8.95 to $18.
How do you decide if MH is a buy?
Rather than asking whether MH is a buy in the abstract, it tends to help to answer four questions:
- Thesis: do you believe the case above, and is it still true today?
- Time horizon: a single stock can be volatile, so a longer horizon absorbs more of the swings.
- Position sizing: a thesis can be right and the sizing still wrong; decide how much of your portfolio one name should be.
- Overlap: check whether you already hold MH indirectly through an index or sector ETF before adding more.
For the full picture, see the MH stock guide (what the company does, the ETFs that hold it, similar stocks, and the themes it fits). In Walnut you can ask its AI about MH against your real portfolio and see your actual exposure before deciding.
The bottom line on MH
The bottom line: McGraw Hill's story right now is Shift to recurring digital revenue, with revenue (fy2026, ended march 2026) at ~$2.10B (+0.1% YoY). If you believe that narrative continues, the call is about sizing MH sensibly and checking overlap with what you own; if you doubt it (the risk: mcGraw Hill still carries meaningful debt from its private-equity ownership, so a large share of operating cash flow goes to interest and principal rather than shareholders, and rising rates or a stumble in growth would pressure the equity.), it is not for you. Decide from the thesis, not the ticker. Walnut is not an investment adviser.
Build a basket around MH with Walnut
Use McGraw Hill as one constituent in a thematic basket Walnut's AI helps you assemble. Describe a thesis you believe in, the AI proposes the holdings and weights, and you approve before any broker order.
FAQ
Is MH a good stock to buy right now?
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The case for McGraw Hill right now is Shift to recurring digital revenue, with revenue (fy2026, ended march 2026) at ~$2.10B (+0.1% YoY). If you believe that thesis holds, MH is a way to own it and the real questions are sizing and overlap, not timing; the main risk to that view is mcGraw Hill still carries meaningful debt from its private-equity ownership, so a large share of operating cash flow goes to interest and principal rather than shareholders, and rising rates or a stumble in growth would pressure the equity. So it comes down to whether you believe the thesis. Walnut is not an investment adviser and this is not a recommendation.
What does McGraw Hill do?
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McGraw Hill, Inc.
What are the main risks of MH?
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McGraw Hill still carries meaningful debt from its private-equity ownership, so a large share of operating cash flow goes to interest and principal rather than shareholders, and rising rates or a stumble in growth would pressure the equity. Overall revenue growth has been roughly flat, with strength in Higher Education offset by softer K-12 and international results that depend on school-district and government budgets. The industry faces structural pressure from free open educational resources, used-book and rental markets, and enrollment declines in parts of US higher education. Competition is intense from Pearson, Cengage, and Houghton Mifflin Harcourt, and increasingly from large technology firms building AI tutors and content. The stock has traded well below its $17 IPO price, and as a recently public, controlled company it carries limited trading history and concentrated ownership.
What does McGraw Hill do?
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McGraw Hill is a global education company that provides curriculum, courseware, assessments, and adaptive-learning platforms for K-12 schools, colleges and universities, and professional learners. Its digital products, including ALEKS and Connect, now generate most of its revenue, shifting the business from printed textbooks toward recurring subscriptions.
Is MH stock the same McGraw Hill from S&P and the credit ratings business?
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No. The old McGraw Hill Companies became S&P Global, keeping the ratings and financial-data businesses. The education division was sold to Apollo Global Management in 2013, operated privately, and returned to the public market as McGraw Hill, Inc. under the ticker MH in July 2025. They are separate companies.
Is McGraw Hill profitable?
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In fiscal 2026, ended March 31, 2026, McGraw Hill reported positive GAAP net income of about $35 million, a swing from a prior-year loss, on revenue of roughly $2.1 billion and adjusted EBITDA near $744 million. Profitability has been improving as recurring digital revenue grows and interest expense from debt reduction falls.
Why has MH stock traded below its IPO price?
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McGraw Hill went public in July 2025 at $17 per share and traded around $9 to $10 by mid-July 2026. The decline reflects its heavy debt load, roughly flat overall revenue growth, and investor caution toward recently public, private-equity-backed companies, even as digital and recurring revenue have grown.
Walnut is informational and is not an investment adviser. This page is educational and not a recommendation to buy or sell MH; figures are approximate and dated, and your own situation, time horizon, and risk tolerance should drive any decision. Verify current data before investing.