U.S. Markets closed
  • S&P Futures

    3,840.00
    +5.75 (+0.15%)
     
  • Dow Futures

    30,950.00
    +41.00 (+0.13%)
     
  • Nasdaq Futures

    13,390.00
    +28.50 (+0.21%)
     
  • Russell 2000 Futures

    2,163.60
    -0.40 (-0.02%)
     
  • Crude Oil

    52.19
    -0.08 (-0.15%)
     
  • Gold

    1,856.10
    -0.10 (-0.01%)
     
  • Silver

    25.61
    +0.06 (+0.23%)
     
  • EUR/USD

    1.2170
    -0.0003 (-0.0243%)
     
  • 10-Yr Bond

    1.0910
    -0.0180 (-1.62%)
     
  • Vix

    21.91
    +0.59 (+2.77%)
     
  • GBP/USD

    1.3687
    -0.0043 (-0.3162%)
     
  • USD/JPY

    103.8050
    +0.3000 (+0.2898%)
     
  • BTC-USD

    32,159.15
    +364.82 (+1.15%)
     
  • CMC Crypto 200

    651.44
    +41.45 (+6.79%)
     
  • FTSE 100

    6,695.07
    -20.35 (-0.30%)
     
  • Nikkei 225

    28,631.45
    -125.45 (-0.44%)
     

Chegg (CHGG) Dips More Than Broader Markets: What You Should Know

Zacks Equity Research
·3 min read

Chegg (CHGG) closed at $65.26 in the latest trading session, marking a -1.46% move from the prior day. This change lagged the S&P 500's 0.84% loss on the day. At the same time, the Dow lost 0.47%, and the tech-heavy Nasdaq lost 1.27%.

Prior to today's trading, shares of the provider of online textbook rental services had lost 14.67% over the past month. This has lagged the Computer and Technology sector's gain of 0.69% and the S&P 500's gain of 0.6% in that time.

Investors will be hoping for strength from CHGG as it approaches its next earnings release. On that day, CHGG is projected to report earnings of $0.12 per share, which would represent a year-over-year decline of 33.33%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $143.89 million, up 52.83% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $1.27 per share and revenue of $612.93 million. These totals would mark changes of +39.56% and +49.16%, respectively, from last year.

Any recent changes to analyst estimates for CHGG should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 1.85% higher within the past month. CHGG is holding a Zacks Rank of #3 (Hold) right now.

Valuation is also important, so investors should note that CHGG has a Forward P/E ratio of 52.2 right now. Its industry sports an average Forward P/E of 81.06, so we one might conclude that CHGG is trading at a discount comparatively.

Investors should also note that CHGG has a PEG ratio of 1.74 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Internet - Software stocks are, on average, holding a PEG ratio of 5.61 based on yesterday's closing prices.

The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 180, putting it in the bottom 30% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Chegg, Inc. (CHGG) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.