Are You Expecting This From McGraw-Hill?

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McGraw-Hill (NYSE: MHP) is expected to report Q2 earnings on July 26. Here's what Wall Street wants to see:

The 10-second takeaway
Comparing the upcoming quarter to the prior-year quarter, average analyst estimates predict McGraw-Hill' revenue will expand 0.5% and EPS will increase 11.8%.

The average estimate for revenue is $1.59 billion. On the bottom line, the average EPS estimate is $0.76.

Revenue details
Last quarter, McGraw-Hill reported revenue of $1.33 billion. GAAP reported sales were 5.6% higher than the prior-year quarter's $1.26 billion.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
Last quarter, non-GAAP EPS came in at $0.51. GAAP EPS of $0.43 for Q1 were 10% higher than the prior-year quarter's $0.39 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Recent performance
For the preceding quarter, gross margin was 60.3%, 20 basis points better than the prior-year quarter. Operating margin was 19.1%, 200 basis points better than the prior-year quarter. Net margin was 9.2%, 30 basis points worse than the prior-year quarter.

Looking ahead
The full year's average estimate for revenue is $6.50 billion. The average EPS estimate is $3.31.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 476 members out of 521 rating the stock outperform, and 45 members rating it underperform. Among 189 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 169 give McGraw-Hill a green thumbs-up, and 20 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on McGraw-Hill is outperform, with an average price target of $50.57.

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