Chegg (CHGG) versus Its Rivals Critical Survey

Chegg (NYSE: CHGG) is one of 40 public companies in the “Educational services” industry, but how does it compare to its peers? We will compare Chegg to related businesses based on the strength of its risk, dividends, analyst recommendations, earnings, valuation, institutional ownership and profitability.

Profitability

This table compares Chegg and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Chegg -7.95% -2.37% -1.97%
Chegg Competitors -14.71% -22.50% -7.16%

Analyst Ratings

This is a summary of recent recommendations and price targets for Chegg and its peers, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Chegg 0 4 7 0 2.64
Chegg Competitors 121 582 667 10 2.41

Chegg currently has a consensus target price of $19.10, suggesting a potential downside of 7.55%. As a group, “Educational services” companies have a potential upside of 9.07%. Given Chegg’s peers higher probable upside, analysts plainly believe Chegg has less favorable growth aspects than its peers.

Risk and Volatility

Chegg has a beta of 1.49, meaning that its stock price is 49% more volatile than the S&P 500. Comparatively, Chegg’s peers have a beta of 0.84, meaning that their average stock price is 16% less volatile than the S&P 500.

Institutional and Insider Ownership

51.0% of shares of all “Educational services” companies are owned by institutional investors. 20.4% of Chegg shares are owned by company insiders. Comparatively, 26.0% of shares of all “Educational services” companies are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Chegg and its peers gross revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Chegg $255.07 million -$20.28 million -229.56
Chegg Competitors $529.42 million $31.24 million 18.80

Chegg’s peers have higher revenue and earnings than Chegg. Chegg is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Summary

Chegg peers beat Chegg on 7 of the 13 factors compared.

About Chegg

Chegg, Inc. is a student-first connected learning platform. The Company helps students study for college admission exams, find the colleges, get grades and test scores while in school, and find internships that allow them to gain skills to help them enter the workforce after college. The Company matches domestic and international students with colleges, universities and other academic institutions (collectively referred to as colleges) in the United States. It also offers eTextbooks library for rent and sale. The Company also has live tutors on its connected learning platform available to students online, anytime, anywhere through its Chegg Tutors service. It provides access to internships to help students gain skills that are critical to securing their first job. It offers two product lines: Required Materials and Chegg Services. The Required Materials product line includes the rental and sale of print textbooks and eTextbooks, as well as the commission it receives from Ingram.

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