Chegg, a technology company that provides online student services, recently reported its quarterly earnings data to the public and investors. According to their financial report released on February 6th, the company’s EPS or earnings per share were $0.40. These figures exceeded consensus estimates by $0.02, indicating a healthy performance by Chegg.
Additionally, the report revealed several important financial ratios for the company. Chegg’s return on equity (ROE) was found to be 4.82%, meaning they generated a profit of approximately five cents for every dollar invested by shareholders. The net margin of the business was calculated at 34.97%, highlighting their ability to control operating expenses and efficiently earn revenue.
Sales revenue for Chegg was also disclosed in their report; they recorded $205.19 million during Q4-2020 alone, compared to analyst expectations of $202.10 million. However, this figure showed a marginal decline from sales results from the previous year quarter indicating a contraction of 1.1%.
Several institutional investors made moves with CHGG stock recently showing confidence in the company’s future prospects and potential for growth. Compagnie Lombard Odier SCmA purchased CHGG shares worth approximately $27 thousand in Q4-2020 while Wipfli Financial Advisors LLC followed suit with purchases worth about $36 thousand in Q3 -2020.
Pathstone Family Office LLC acquired more than one-sixth of Chagg’s outstanding shares valued at roughly $5,524,000 during Q4-2020 demonstrating strong support from them.
As of May 2021 CHGG has seen many funds reduce their investment in Chegg stock such as Van ECK Associates Corp who sold off over half their holdings leaving just shy of 73K shares valued currently at around$2m which is now worth way less compared to when VEA first started buying CHGG shares in early 2016.
Chegg’s stock opened at $9.44 on Friday and now trades in the mid $30s range (~$35). It has a market capitalization of $1.13 billion, and its price-to-earnings ratio (P/E) is calculated at 7.15 which considering the strength of fundamentals recorded in their report makes CHEGG stock an attractive opportunity for savvy investors to buy and hold long-term for growth anda potentially strong profit margin for not just funds investing in Chegg shares but also individual shareholders as well.
Cuttting Q2 Earnings: Chegg Inc. Downgraded by Multiple Analysts
The technological company, Chegg Inc., has received a cut in its Q2 2023 earnings per share (EPS) estimates, according to a report by Barrington Research. Analyst A. Paris has predicted that the company will post an EPS of $0.03 for the quarter, down from their initial estimate of $0.10. Although Barrington Research currently gives Chegg a “Market Perform” rating, it is not the only analyst to recently downgrade the company’s stock. Needham & Company LLC and Northland Securities have already decreased their ratings while BMO Capital Markets lowered their price objective on shares from $20.00 to $12.00, which was followed by Morgan Stanley reducing their price estimate also.
Eleven research analysts have rated Chegg’s stocks with a hold rating and only two have issued a buy rating for the stock in recent weeks resulting in the average consensus being ‘hold’. With regards to insider trading activity, CMO Esther Lem sold 5,700 shares of the technological giant’s stock on March 6th at an approximate value of $96,102.00 with COO Nathan J. Schultz following suit selling 4,041 shares soon after on March 2nd totalling US$63,201.
Although these occurrences seem rather ominous for Chegg Inc., investors should be mindful reduction can act as a buy signal at times especially if they believe that this is just a momentary setback for the enterprise and not indicative of its long-term growth prospects.
