Chegg Shares Dip On Analyst Warnings About Subscriber Numbers, Rising Competition
Portfolio Pulse from Priya Nigam
Chegg Inc (NYSE:CHGG) shares dropped after Morgan Stanley analyst Josh Baer downgraded the stock from Equal-Weight to Underweight and reduced the price target from $10 to $9. Baer cited concerns over high consensus estimates, potential negative revisions, and worsening subscriber trends. He also mentioned the increasing competition from GenAI and the possibility of an ARPU shift from a tailwind to a headwind. Chegg's stock fell 6.9% to $9.74 following the downgrade.
November 20, 2023 | 4:16 pm
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Chegg's stock price declined following a downgrade by Morgan Stanley analyst Josh Baer, who expressed concerns over subscriber numbers and increased competition, potentially leading to negative future revisions.
The downgrade by a prominent analyst based on weakening subscriber trends and competitive pressures is likely to negatively influence investor sentiment in the short term. The reduction in the price target further exacerbates the negative outlook, leading to a decline in the stock price.
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IMPORTANCE 85
RELEVANCE 100