CHEGG INC (CHGG) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:CHGG - US1630921096 - Common Stock
0.7784 USD
-0.01 (-1.44%)
We assign a fundamental rating of 3 out of 10 to CHGG. 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 on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
- CHGG had positive earnings in the past year.
- In the past year CHGG had a positive cash flow from operations.
- The reported net income has been mixed in the past 5 years: CHGG reported negative net income in multiple years.
- CHGG had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- The Return On Assets of CHGG (-20.29%) is worse than 69.74% of its industry peers.
- CHGG has a Return On Equity of -52.54%. This is in the lower half of the industry: CHGG underperforms 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.
- In the last couple of years the Gross Margin of CHGG has declined.
- 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.
- The number of shares outstanding for CHGG has been reduced compared to 5 years ago.
- CHGG has a worse debt/assets ratio than last year.
2.2 Solvency
- Based on the Altman-Z score of -2.72, we must say that CHGG is in the distress zone and has some risk of bankruptcy.
- CHGG has a worse Altman-Z score (-2.72) than 73.68% of its industry peers.
- CHGG has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 8.14 | ||
| Altman-Z | -2.72 |
ROIC/WACCN/A
WACC2.23%
2.3 Liquidity
- CHGG has a Current 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.
- CHGG's Current ratio of 0.95 is in line compared to the rest of the industry. CHGG outperforms 40.79% of its industry peers.
- 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.
- CHGG's Quick ratio of 0.95 is in line compared to the rest of the industry. CHGG outperforms 43.42% of its industry peers.
| 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%.
- CHGG shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -3.54% yearly.
- 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.
- Based on estimates for the next years, CHGG will show a very negative growth in Revenue. The Revenue will decrease by -21.41% on average per year.
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.
- The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- A Price/Earnings ratio of 3.71 indicates a rather cheap valuation of CHGG.
- 96.05% of the companies in the same industry are more expensive than CHGG, based on the Price/Earnings ratio.
- CHGG is valuated cheaply when we compare the Price/Earnings ratio to 27.30, which is the current average of the S&P500 Index.
- A Price/Forward Earnings ratio of 76.31 indicates a quite expensive valuation of CHGG.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of CHGG is on the same level as its industry peers.
- CHGG is valuated expensively when we compare the Price/Forward Earnings ratio to 24.32, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 3.71 | ||
| Fwd PE | 76.31 |
4.2 Price Multiples
- 85.53% of the companies in the same industry are more expensive than CHGG, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.07 | ||
| EV/EBITDA | -0.26 |
4.3 Compensation for Growth
- CHGG's earnings are expected to decrease with -34.44% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-88.42%
EPS Next 3Y-34.44%
5. Dividend
5.1 Amount
- No dividends for CHGG!.
| 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.