Graham Holdings Company (GHC) vs McGraw Hill, Inc. (MH)

Graham Holdings Company and McGraw Hill, Inc. are both Education & Training Services companies. Graham Holdings Company is the larger, with a market value of $5.1B against $2.7B — 1.9× the size. Graham Holdings Company trades at the lower P/E: 9.6× against 27.7×. Graham Holdings Company grew revenue faster over the last twelve months: 4.83% against 0.14%. Graham Holdings Company has the higher net margin (10.7% vs 4.38%) and the lower return on invested capital (3.64% vs 5.81%). Across the 20 metrics below, Graham Holdings Company leads on 11 and McGraw Hill, Inc. on 9.

Valuation

Metric GHC MH Education & Training Services median
P/E 9.60 27.68 13.22
P/S 1.01 1.25 0.99
P/B 1.07 3.36 1.62
Price to free cash flow 20.70 12.89 10.06
EV/EBITDA 10.43 6.51 8.56
EV/Sales 0.93 2.37 0.78
Earnings yield 10.42% 3.61% 3.17%
Free cash flow yield 4.83% 7.76% 2.81%

Profitability

Metric GHC MH Education & Training Services median
Gross margin 29.95% 81.65% 54.64%
Operating margin 5.05% 13.93% 0.00%
Net margin 10.69% 4.38% 2.98%
Free cash flow margin 4.89% 9.70% 0.00%
Return on equity 11.80% 17.30% 0.00%
Return on assets 6.88% 1.68% 0.00%
Return on invested capital 3.64% 5.81% 0.00%

Growth

Metric GHC MH Education & Training Services median
Revenue growth (TTM) 4.83% 0.14% 6.97%
EPS growth (last fiscal year) (59.32%) 136.88% 15.68%
Revenue growth, 5-year CAGR 11.20% — 4.27%
Net income growth, 5-year CAGR (0.54%) — 0.00%

Health

Metric GHC MH Education & Training Services median
Debt to equity 0.19 3.27 0.05
Current ratio 1.86 0.78 1.33
Net debt to EBITDA (1.24) 3.07 (0.15)

Dividend

Metric GHC MH Education & Training Services median
Dividend yield 0.62% — 1.84%
Payout ratio 0.06 — 0.23

Size

Metric GHC MH Education & Training Services median
Market cap 5.08b 2.72b 68.84m

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