Investors Purchase High Volume of Chegg Call Options (NYSE:CHGG)

Key Points

• Traders bought 3,099 call options on Chegg (NYSE:CHGG) — an 86% increase versus the stock's average daily call volume, indicating unusually heavy bullish/options interest.
• Wall Street sentiment is negative with a consensus rating of Reduce (two Hold and two Sell ratings), yet the stock spiked about 9.2% to $0.73 on the reporting day.
• Fundamentals are mixed: Chegg beat quarterly estimates (EPS -$0.01 vs. -$0.19; revenue $72.66M vs. $71M) but remains unprofitable with a -27.44% net margin, negative ROE, and a market cap near $80 million.

Chegg, Inc. (NYSE:CHGG - Get Free Report) saw unusually large options trading activity on Tuesday. Traders bought 3,099 call options on the stock. This is an increase of 86% compared to the average daily volume of 1,664 call options.

Wall Street Analysts Forecast Growth

A number of research analysts have recently weighed in on the stock. Needham & Company LLC restated a "hold" rating on shares of Chegg in a report on Tuesday, February 10th. Zacks Research cut shares of Chegg from a "strong-buy" rating to a "hold" rating in a report on Monday, January 12th. Finally, Weiss Ratings reissued a "sell (e+)" rating on shares of Chegg in a research report on Friday. Two research analysts have rated the stock with a Hold rating and two have issued a Sell rating to the stock. According to data from MarketBeat.com, the company presently has a consensus rating of "Reduce".

Chegg Trading Up 9.2%

Chegg stock traded up $0.06 during trading hours on Tuesday, reaching $0.73. 483,589 shares of the company were exchanged, compared to its average volume of 1,176,566. Chegg has a 12 month low of $0.44 and a 12 month high of $1.90. The stock has a 50-day moving average of $0.65 and a 200 day moving average of $0.96. The firm has a market cap of $80.20 million, a price-to-earnings ratio of -0.76 and a beta of 1.99.

Chegg (NYSE:CHGG - Get Free Report) last released its quarterly earnings results on Monday, February 9th. The technology company reported ($0.01) EPS for the quarter, beating analysts' consensus estimates of ($0.19) by $0.18. The company had revenue of $72.66 million for the quarter, compared to analyst estimates of $71.00 million. Chegg had a negative net margin of 27.44% and a negative return on equity of 18.30%. As a group, research analysts forecast that Chegg will post 0.15 EPS for the current year.

Institutional Inflows and Outflows

A number of institutional investors and hedge funds have recently bought and sold shares of the company. Concurrent Investment Advisors LLC acquired a new stake in shares of Chegg during the 4th quarter worth approximately $105,000. Qube Research & Technologies Ltd acquired a new position in shares of Chegg in the third quarter valued at $32,000. BNP Paribas Financial Markets raised its stake in shares of Chegg by 564.8% in the third quarter. BNP Paribas Financial Markets now owns 34,060 shares of the technology company's stock valued at $51,000 after purchasing an additional 28,937 shares in the last quarter. Allianz Asset Management GmbH bought a new position in Chegg in the third quarter worth $484,000. Finally, Hudson Bay Capital Management LP bought a new position in Chegg in the second quarter worth $36,000. Institutional investors and hedge funds own 95.18% of the company's stock.

Chegg Company Profile

Chegg, Inc NYSE: CHGG is a leading education technology company headquartered in Santa Clara, California. Originally founded in 2005, Chegg has evolved from a textbook rental service into a comprehensive digital learning platform. Its suite of subscription-based offerings addresses a wide range of academic needs, catering primarily to high school and college students seeking homework help, study resources, and career guidance.

The company's core services include Chegg Study, which provides step-by-step solutions and expert Q&A support; Chegg Writing, offering plagiarism checks and guided writing assistance; and Chegg Math Solver, a tool for solving mathematical problems with detailed explanations.

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