CHEGG INC (CHGG) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:CHGG - US1630921096 - Common Stock
0.7996 USD
-0.01 (-0.62%)
0.78 USD
-0.02 (-2.45%)
Taking everything into account, CHGG scores 3 out of 10 in our fundamental rating. CHGG was compared to 76 industry peers in the Diversified Consumer Services industry. While CHGG seems to be doing ok healthwise, there are quite some concerns on its profitability. CHGG has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
- In the past year CHGG was profitable.
- CHGG had a positive operating cash flow in the past year.
- In multiple years CHGG reported negative net income over the last 5 years.
- Each year in the past 5 years CHGG had a positive operating cash flow.
1.2 Ratios
- CHGG has a worse Return On Assets (-20.29%) than 69.74% of its industry peers.
- CHGG's Return On Equity of -52.54% is on the low side compared to the rest of the industry. CHGG is outperformed by 67.11% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -20.29% | ||
| ROE | -52.54% | ||
| ROIC | N/A |
ROA(3y)-28.15%
ROA(5y)-16.96%
ROE(3y)-135.99%
ROE(5y)-81.82%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
- The Gross Margin of CHGG (63.25%) is better than 77.63% of its industry peers.
- CHGG's Gross Margin has declined in the last couple of years.
- CHGG does not have Profit Margin and Operating Margin available, so we won't be analyzing them here.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | N/A | ||
| PM (TTM) | N/A | ||
| GM | 63.25% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y1.79%
GM growth 5Y-1.8%
2. Health
2.1 Basic Checks
- CHGG does not have a ROIC to compare to the WACC, probably because it is not profitable.
- The number of shares outstanding for CHGG has been increased compared to 1 year ago.
- CHGG has less shares outstanding than it did 5 years ago.
- Compared to 1 year ago, CHGG has a worse debt to assets ratio.
2.2 Solvency
- Based on the Altman-Z score of -2.71, we must say that CHGG is in the distress zone and has some risk of bankruptcy.
- The Altman-Z score of CHGG (-2.71) is worse than 73.68% of its industry peers.
- There is no outstanding debt for CHGG. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 8.14 | ||
| Altman-Z | -2.71 |
ROIC/WACCN/A
WACC2.25%
2.3 Liquidity
- A Current Ratio of 0.95 indicates that CHGG may have some problems paying its short term obligations.
- Looking at the Current ratio, with a value of 0.95, CHGG is in line with its industry, outperforming 40.79% of the companies in the same industry.
- CHGG has a Quick Ratio of 0.95. This is a bad value and indicates that CHGG is not financially healthy enough and could expect problems in meeting its short term obligations.
- Looking at the Quick ratio, with a value of 0.95, CHGG is in line with its industry, outperforming 43.42% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.95 | ||
| Quick Ratio | 0.95 |
3. Growth
3.1 Past
- CHGG shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -77.89%.
- Measured over the past years, CHGG shows a decrease in Earnings Per Share. The EPS has been decreasing by -3.54% on average per year.
- The Revenue for CHGG has decreased by -32.37% in the past year. This is quite bad
- Measured over the past years, CHGG shows a quite strong growth in Revenue. The Revenue has been growing by 8.49% on average per year.
EPS 1Y (TTM)-77.89%
EPS 3Y-16.17%
EPS 5Y-3.54%
EPS Q2Q%-100%
Revenue 1Y (TTM)-32.37%
Revenue growth 3Y-7.34%
Revenue growth 5Y8.49%
Sales Q2Q%-43.08%
3.2 Future
- CHGG is expected to show a very negative growth in Earnings Per Share. In the coming years, the EPS will decrease by -34.44% yearly.
- The Revenue is expected to decrease by -21.41% on average over the next years. This is quite bad
EPS Next Y-108.05%
EPS Next 2Y-88.42%
EPS Next 3Y-34.44%
EPS Next 5YN/A
Revenue Next Year-39.13%
Revenue Next 2Y-31.51%
Revenue Next 3Y-21.41%
Revenue Next 5YN/A
3.3 Evolution
- The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 3.81, the valuation of CHGG can be described as very cheap.
- CHGG's Price/Earnings ratio is rather cheap when compared to the industry. CHGG is cheaper than 96.05% of the companies in the same industry.
- CHGG's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 28.60.
- Based on the Price/Forward Earnings ratio of 78.39, the valuation of CHGG can be described as expensive.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of CHGG is on the same level as its industry peers.
- The average S&P500 Price/Forward Earnings ratio is at 25.83. CHGG is valued rather expensively when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 3.81 | ||
| Fwd PE | 78.39 |
4.2 Price Multiples
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of CHGG indicates a rather cheap valuation: CHGG is cheaper than 84.21% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.37 | ||
| EV/EBITDA | -0.19 |
4.3 Compensation for Growth
- A cheap valuation may be justified as CHGG's earnings are expected to decrease with -34.44% in the coming years.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-88.42%
EPS Next 3Y-34.44%
5. Dividend
5.1 Amount
- CHGG does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
CHEGG INC / CHGG FAQ
Can you provide the ChartMill fundamental rating for CHEGG INC?
ChartMill assigns a fundamental rating of 3 / 10 to CHGG.
What is the valuation status for CHGG stock?
ChartMill assigns a valuation rating of 4 / 10 to CHEGG INC (CHGG). This can be considered as Fairly Valued.
How profitable is CHEGG INC (CHGG) stock?
CHEGG INC (CHGG) has a profitability rating of 2 / 10.
What is the earnings growth outlook for CHEGG INC?
The Earnings per Share (EPS) of CHEGG INC (CHGG) is expected to decline by -108.05% in the next year.