McGraw Hill Financial, Inc. (MHFI) stated that it has completed the sale of Aviation Week to Penton. However, financial terms of the deal were not disclosed.
The move is strategic fit for McGraw Hill Financial as the company is restructuring its portfolio of businesses to concentrate more on high growth operations, thereby enhancing shareholder value through proper capital allocation.
McGraw Hill Financial now primarily focuses on capital and commodities markets. It reclassified its Education segment as discontinued operations, which was divested to Apollo Global Management LLC (APO) for $2.4 billion in cash. The company also seeks to increase its ownership in CRISIL to 75% from the existing 53%.
Moreover, McGraw-Hill Financial has made several strategic investments in its core businesses to drive growth. The formation of S&P Dow Jones Indices coupled with S&P Capital IQ’s acquisitions of Credit Market Analysis Limited, QuantHouse, R2 Financial Technologies and TheMarkets.com position it well against other industry majors like privately held Fitch, Moody’s Corp. (MCO) and Dun & Bradstreet (DNB).
We believe the company’s strategic initiatives and investments in core businesses would lead to higher profits in the long run.
Recently, the company came up with strong Q2 results. McGraw-Hill Financial posted second-quarter 2013 adjusted earnings of 92 cents a share, which jumped 31% from the year-ago quarter and comfortably surpassed the Zacks Consensus Estimate of 81 cents.
Top line escalated 17% year over year to $1,250 million and surpassed the Zacks Consensus Estimate of $1,207 million.
McGraw-Hill Financial raised its 2013 earnings guidance range. The company now expects earnings in the range of $3.15 – $3.25 per share. Currently, McGraw Hill Financial holds a Zacks Rank #2 (Buy).
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