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Chegg Crumbles After Earnings: Too Cheap To Ignore

May 03, 2022 11:33 PM ETChegg, Inc. (CHGG)26 Comments


  • Chegg fell 30% after earnings - after having already fallen 70% from all-time highs.
  • The stock now trades at the same levels it did 5 years ago.
  • The company adjusted full year guidance lower while blaming inflation, the economy, and weak enrollment numbers.
  • The near-term outlook might not be pretty, but the stock is too cheap to ignore here.
  • Looking for a portfolio of ideas like this one? Members of Best Of Breed get exclusive access to our model portfolio. Learn More »

Chegg.com Campus Takeover"s "Late Night with Chegg" - Austin

Sarah Kerver/Getty Images Entertainment

Chegg (NYSE:CHGG) saw its stock tumble after reporting earnings and guiding on its forward outlook. The company blamed low enrollment, a weakening economy, and rising inflation as culprits for the weaker than expected financial outlook. The latest fall

Chart: CHGG peaked above $112 per share in early 2021
Data by YCharts

Chegg business model

Chegg 2022 Q1 Presentation

Chegg revenue

Chegg 2022 Q1 Presentation

Chegg margin expansion

Chegg 2022 Q1 Presentation

Chegg outlook

Chegg 2022 Q1 Presentation

textbook transition

Chegg 2022 Q1 Presentation

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This article was written by

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High conviction investment ideas in the winners of tomorrow.

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Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in CHGG over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

I am long all holdings of the Best of Breed portfolio.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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