MHFI
McGraw Hill Financial Inc
Finance/Real Estate, Event Driven/Special Sit
04/07/2014
Presented
| Date | 04/02/2014 |
| Price | $76.37 |
| Market Cap | $20.90B |
| Ent Value | $20.99B |
| P/E Ratio | N/A |
| Book Value | $1.79 |
| Div Yield | 1.3% |
| Shares O/S | 273.65M |
| Ave Daily Vol | 1,790,000 |
| Short Int | 1.31% |
Current
| Price | $390.86 |
| Market Cap | $124.37B |
| McGraw Hill Financial, Inc., a financial intelligence company, provides credit ratings, benchmarks, and analytics to capital and commodity markets worldwide. The company’s operations consist of four segments: Standard & Poor’s Ratings (S&P Ratings), S&P Capital IQ, S&P Dow Jones Indices (S&P DJ Indices), and Commodities & Commercial (C&C). The S&P Ratings segment offers credit ratings, research, and analytics for investors, corporations, governments, municipalities, commercial and investment banks, insurance companies, asset managers, and other debt issuers. The S&P Capital IQ segment provides digital and traditional financial research and analytical tools, which integrate cross-asset analytics, desktop services, and investment information. It serves asset managers, investment banks, investors, brokers, financial advisors, and investment sponsors, as well as companies’ back-office functions, including compliance, operations, risk, clearance, and settlement. The S&P DJ Indices segment maintains various valuation and index benchmarks for investment advisors, wealth managers, and institutional investors. The C&C segment offers information, data, analytic services, and pricing benchmarks for producers, traders, and intermediaries in energy, metals, and agriculture markets, as well as professionals and executives in automotive, construction, and marketing/research services markets. This segment consists of business to business companies that include brands, such as Platts, J.D. Power and Associates, and McGraw-Hill Construction. The company was formerly known as The McGraw-Hill Companies, Inc. and changed its name to McGraw Hill Financial, Inc. in May 2013 after the sale of McGraw-Hill Education to Apollo Global Management, LLC. McGraw Hill Financial, Inc. was founded in 1888 and is headquartered in New York, New York. |
Highlights
When the presenter dug into McGraw Hill’s (MHFI) business model and financial statements he liked what he saw. The company has $1b net cash on its balance sheet, and recently sold its education business to Apollo. Approximately 45% of EBIT is not ratings-oriented, and while the company does face a potential future liability due to the DOJ litigation, the penalty may not be as bad as some fear. Overall, he sees a company that is diversified within its industry and can potentially grow EBIT at a mid-teens (%) rate and generate FCF for at least the next few years.
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