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Pearson

PSO
47
Publishing · Communication Services
Exchange
New York Stock Exchange
Winston Score
47
Winston is serious
Mixed quality — meaningful strengths and weaknesses.
Data as of Aug 23, 2026 · filings through Jun 30, 2026
How the score breaks down
Quality
Good
Growth
Mixed
Cash Flow
Exceptional
Stability
Strong
Valuation
Strong
Dividends
Mixed

Winston Score History

The full picture

Pearson is a British education company that makes textbooks, online courses, and learning software used by students and teachers around the world. Its main products include digital learning platforms, standardized tests, and academic content sold to schools, universities, and individual learners. Pearson is one of the largest education publishers in the world and owns well-known testing programs like GED and Pearson VUE.

Pearson makes money by selling digital subscriptions, print and digital textbooks, and charging fees for professional certification exams. It operates globally but earns most of its revenue in North America and the UK, with annual revenue around $4 billion. Its large library of educational content and its role running high-stakes tests give it some switching-cost advantages, but the shift away from print textbooks toward cheaper digital alternatives and open educational resources remains a significant long-term pressure on its traditional publishing business.

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Growth Profile

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

+4.1% YoY

YoY Growth Rate

Slow revenue growth

EPS Growth

-4.0% YoY

YoY Growth Rate

Earnings declining

Insider Activity

0.0%ownership

Flat

Insider ownership roughly steady over the past year

Cash Position

Cash flow positive

$646M cash & investments

Quarterly Free Cash Flow

↑ Burn rate improving

Company generates more cash than it spends — no dilution risk from fundraising

Growth context

Pearson is growing revenue at 4% year-over-year. The Winston Score measures business quality today — these growth metrics show what could matter tomorrow.

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Score breakdown

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Quality

Profit per sale
Gross Margin
51.2%
Healthy — 51.2% gross margin
Profit after running costs
Operating Margin
14.2%
Healthy — 14.2% operating margin
Return on the money invested
ROCE
11.3%
Below par — 11.3% return on capital

ROIC between 5% and 15%. They earn 5 to 15 cents back per year on every dollar invested.

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Growth

Sales growth
Sales YoY
+3.3%
Slow sales growth (+3.3% YoY)
Profit growth
EPS YoY
-21.5%
Earnings shrinking (-21.5% YoY)

Earnings per share down more than 10%. Either a bad year, or a real decline.

How steady the profit is
EPS Consistency
4/8 quarters
Earnings inconsistent quarter-to-quarter

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Cash Flow

Profit that turns into cash
Cash Conversion
256%
Turns 256% of profit into real cash
Spare cash per sale
FCF Margin
21.4%
Converts sales into free cash efficiently (21.4%)

Free cash flow margin above 20%. Out of every $100 in sales, more than $20 is real cash they keep.

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Stability

What it owes vs what it owns
Debt / Equity
0.41
Conservative — low debt load (0.41)
Covers its interest
Interest Cover
4.22x
Adequate interest coverage (4.2x)

Interest coverage between 3 and 8. Profits cover interest several times over.

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Valuation

Price vs profit
P/E Ratio (TTM)
23.4x
no trend
Growth-priced — P/E 23.4

P/E above the market average. People are paying up for expected growth.

Cheaper or dearer next year
P/E vs Forward
+8.0
GROWING
Earnings expected to grow meaningfully — cheaper on forward P/E (23.4 → 15.5)

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Dividends

Dividend
Dividend Yield
2.11%
no trend
Moderate income — 2.11% yield

Standard yield zone for stable dividend payers. A meaningful piece of total return.

Dividend record
Dividend Growth
-2.1%
no trend
Dividend cut (-2.1% YoY) — warning sign

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