CHGG Should I Buy
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Chegg Inc (CHGG) is not a strong buy at the moment for a beginner investor with a long-term strategy. The technical indicators, financial performance, and lack of significant positive catalysts suggest limited upside potential in the near term. Holding off on this investment is advisable until clearer growth signals emerge.
The technical indicators for CHGG are bearish. The MACD is below 0 and negatively contracting, the RSI is neutral at 36.786, and moving averages show a bearish trend (SMA_200 > SMA_20 > SMA_5). Key support is at 0.553, and resistance is at 0.766, indicating limited upward momentum.
Chegg's announcement of a $20 million repurchase agreement for its convertible notes reflects efforts to optimize debt and maintain financial flexibility.
The U.S. Department of Education's warning about higher education institutions losing federal student aid could negatively impact Chegg's business model. Additionally, the stock's bearish technical indicators and poor financial performance are concerning.
In 2025/Q4, Chegg's revenue dropped significantly by -49.36% YoY to $72.66 million. However, net income improved to -$32.8 million (up 435.56% YoY), and EPS increased to -0.3 (up 400% YoY). Gross margin declined to 57.95%, down -15.54% YoY, indicating operational challenges.
No recent updates on analyst ratings or price target changes were provided. Wall Street sentiment appears neutral, with no significant trading trends from hedge funds or insiders.
