Chegg Inc. (NYSE: CHGG): The Best-Of-Breed For Investing?


    Baillie Gifford & Co. recently announced the acquisition of new stake in Chegg Inc. (NYSE:CHGG). The institutional investor has increased its shareholding in the Consumer Defensive company by 1.74% to 14.67 million shares with purchase of 0.25 million shares. This fresh investment now brings its stake to 11.87% valued currently at $1.19 billion. In addition, Artisan Partners LP raised its holdings by 1.93 million to 4.96 million shares. And ClearBridge Investments LLC has lifted its position by 0.09% or 2157.0 shares – to 2.48 million shares.

    With over 3.17 million Chegg Inc. (CHGG) shares trading Tuesday and a closing price of $75.48 on the day, the dollar volume was approximately $239.44 million. The shares have shown a negative weekly performance of -3.50% and its price on 08/25/20 gained nearly 2.75%. Currently, there are 123.84M common shares owned by the public and among those 121.68M shares have been available to trade.

    An analysis of what Wall Street brokers have to say about the expected price targets for this stock gives us this picture: 14 analysts who have offered their price forecasts for CHGG have a consensus price objective of $94.50. The analysts have set the share’s price value over the next 12 months at a high of $105.00 and a low of $77.00 should the stock experience a downside. Incidentally, analysts’ outlook for the Chegg Inc. stock is 1.80 for the next 12 months. The average price target is 20.13% above its last price level and an upside to the estimated low will see the stock gain 1.97% over that period. But an upside of 28.11% will see the stock hit the forecast high price target while mean target price for the stock is $95.50.

    Insiders at the company have transacted a total of 154 times over the past 12 months, according to data filed with the U.S. Securities and Exchange Commission (SEC). 53 of these insider trades were purchases, accounting for 1,979,258 shares. Insider sales of the common stock occurred on 101 occasions, with total insider shares sold totaling 2,757,318 shares.

    The top 3 mutual fund holders in Chegg Inc. are Vanguard Total Stock Market Index, PRIMECAP Odyssey Aggressive Growt, and Vanguard Small Cap Index Fund. Vanguard Total Stock Market Index owns 3.34 million shares of the company’s stock, all valued at over $270.82 million. The company sold 11858.0 shares recently to bring their total holdings to about 2.71% of the shares outstanding. PRIMECAP Odyssey Aggressive Growt sold -0.2 million shares to see its total holdings shrink to 3.15 million shares valued at over $255.06 million and representing 2.55% of the shares outstanding. Vanguard Small Cap Index Fund sold 22360.0 shares to bring its total holdings to over 2.92 million shares at a value of $236.32 million. Vanguard Small Cap Index Fund now owns shares totaling to 2.36% of the shares outstanding.

    Shares of Chegg Inc. (NYSE: CHGG) opened at $72.85, down -$0.61 from a prior closing price of $73.46. However, the script later closed the day at $75.48, up 2.75%. The company’s stock has a 5-day price change of -3.50% and 24.27% over the past three months. CHGG shares are trading 99.10% year to date (YTD), with the 12-month market performance up to 86.74% higher. It has a 12-month low price of $25.89 and touched a high of $89.82 over the same period. Currently, 3.17 million shares have been traded, compared to an average intraday trading volume of 3.64 million shares. The stock is trading above its simple moving averages at the SMA20, SMA50, and SMA200, as the current price level is off by -4.88%, 2.71%, and 49.93% respectively.

    Institutional ownership of Chegg Inc. (NYSE: CHGG) 123.84M shares outstanding. Mutual fund holders own 46.65%, while other institutional holders and individual stakeholders account for 54.76% and 32.47% respectively.

    It has a market capitalization of $9.40B and a beta (3y monthly) value of 1.04. The stock’s trailing 12-month PE ratio is 15096.00, while the earnings-per-share (ttm) stands at $0.01. The company has a PEG of 603.84 and a Quick Ratio of 8.20 with the debt-to-equity ratio at 1.86. Price movements for the stock have been influenced by the stock’s volatility, which stands at 4.52% over the week and 5.02% over the month.

    Analysts forecast that Chegg Inc. (CHGG) will achieve an EPS of $0.1 for the current quarter, $0.54 for the next quarter and $1.5 for 2021. The lowest estimate earnings-per-share for the quarter is $0.01 while analysts give the company a high EPS estimate of $0.15. Comparatively, EPS for the current quarter was $0.18 a year ago. Earnings per share for the fiscal year are expected to increase by 38.70%, and 22.43% over the next financial year. EPS should shrink at an annualized rate of 25.00% over the next five years, compared to 36.50% over the past 5-year period.

    If you are looking to buy this stock, then you may note that the average analyst recommendation by 14 brokerage firm advisors rate Chegg Inc. (CHGG) as a “Strong Buy” at a consensus score of 1.80. Specifically, 10 Wall Street analysts polled rate the stock as a buy, while 3 of the 14 advise that investors “hold,” and 0 rated it as a “Sell.”

    Looking at the support for the CHGG, a number of firms have released research notes about the stock. Citigroup stated their Buy rating for the stock in a research note on August 04, 2020, with the firm’s price target at. Lake Street coverage for the Chegg Inc. (CHGG) stock in a research note released on August 04, 2020 offered a Hold rating with a price target of $79. KeyBanc Capital Markets was of a view on July 13, 2020 that the stock is Overweight, while KeyBanc Capital Markets gave the stock Overweight rating on June 30, 2020, issuing a price target of $80. Citigroup on their part issued Neutral rating on June 30, 2020.


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