Remember McGraw Hill? The company that probably made your high school textbooks unbearably heavy? Well, they’re back—and this time, they’re actually interesting.
After spending a decade in private equity purgatory, McGraw Hill returned to the public markets in July 2025 at $17 per share. The stock tanked to below $11 before recently surging 21% on solid earnings. Now trading around $13.80, it’s still down 18% from its IPO price, which means the market’s still figuring out what to make of this comeback kid.
Here’s the plot twist: McGraw Hill isn’t just printing textbooks anymore. They’re printing money through digital subscriptions.
The Digital Pivot That Actually Works
In their latest quarter, digital revenue jumped 7.7% to $352.2 million, while print revenue cratered 12% to $317 million. Translation? The company’s finally ditching the dead weight of physical textbooks and betting big on digital learning platforms. And it’s working.
The real money is in recurring revenue—think Netflix, but for education. Recurring revenue climbed 6.5% to $422.4 million, with higher education leading the charge at a 14% jump to $162 million. McGraw Hill’s actually gaining market share in this space, which is rare in publishing. They’re also rolling out AI-powered learning tools, because apparently everything needs AI now.
The Numbers Look Better Than They Sound
Sure, overall revenue dipped 2.8% year-over-year and net income fell 21%. But adjusted earnings per share came in at $1.40, beating estimates of 99 cents. The company also raised its full-year guidance, which is the kind of thing that makes stock prices go up.
Their remaining performance obligation (RPO)—basically contracts already in the pipeline—hit $1.91 billion, up from $1.67 billion six months ago. That’s the kind of visibility investors love.
The Debt Elephant in the Room
Here’s where it gets messy. McGraw Hill is carrying a ton of debt from its leveraged buyout days. The debt-to-equity ratio is high, the current ratio is low, and liquidity is tight. They’re working to pay it down, but it’s a real concern. This isn’t a company that can afford to stumble.
Should You Care?
Wall Street analysts certainly do. The median price target is $19.50, suggesting 41% upside from current levels. Even after the recent rally, the stock looks cheap on a valuation basis.
McGraw Hill’s transformation from a dinosaur print publisher to a digital-first education platform is genuinely compelling. They’ve got a strong business in the pipeline, they’re focused on higher-margin digital products, and they’re actually gaining market share. The debt situation is real, but manageable if execution stays solid.
This might be one of those boring-sounding stocks that actually makes money. And in a market obsessed with AI and tech, sometimes the best opportunities hide in plain sight—even if they’re in textbooks.
