Ebullient underwriter initiation day coverage is not enough to staunch a slide by Chegg (CHGG -5.5%). Jefferies (PT of $14) and BofAML ($11.50) initiated the learning platform maker at Buy, J.P. Morgan ($13), Piper Jaffray ($11), and Raymond James ($12) at Outperform, and BMO Capital ($11) at Perform.
Jefferies noted, "With a focus on saving students time money and helping them to get smarter, we believe Chegg is one of the best positioned in the rapidly evolving education products & services space and that there is meaningful upside from current levels."
BofAML is bullish Chegg's textbook market, cloud-based Student Hub, and "early leadership in digital books." The firm also thinks "the high capital requirements of book distribution serve as significant competitive moats, and we see few retailers that can effectively compete with Chegg."