Chegg (NYSE:CHGG) vs. Graham (NYSE:GHC) Financial Survey

Graham (NYSE:GHC) and Chegg (NYSE:CHGG) are both consumer discretionary companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, risk, profitability, dividends, analyst recommendations, valuation and institutional ownership.

Institutional & Insider Ownership

93.2% of Graham shares are held by institutional investors. Comparatively, 95.2% of Chegg shares are held by institutional investors. 18.6% of Graham shares are held by company insiders. Comparatively, 3.0% of Chegg shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Risk & Volatility

Graham has a beta of 0.73, meaning that its share price is 27% less volatile than the S&P 500. Comparatively, Chegg has a beta of 2.26, meaning that its share price is 126% more volatile than the S&P 500.

Profitability

This table compares Graham and Chegg’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Graham	9.66%	6.01%	3.50%
Chegg	-17.17%	-16.11%	-8.16%

Valuation and Earnings

This table compares Graham and Chegg”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Graham	$4.91 billion	1.06	$292.29 million	$113.77	10.93
Chegg	$234.24 million	0.27	-$103.42 million	($0.37)	-1.55

Graham has higher revenue and earnings than Chegg. Chegg is trading at a lower price-to-earnings ratio than Graham, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent ratings and price targets for Graham and Chegg, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Graham	0	0	2	1	3.33
Chegg	1	2	0	0	1.67

Summary

Graham beats Chegg on 12 of the 14 factors compared between the two stocks.

About Graham

Graham Holdings Company is a diversified holding company formerly known as The Washington Post Company. It adopted its current name in 2013 after selling The Washington Post and related publications. Today, its businesses span education, television broadcasting, manufacturing, healthcare and automotive retail. Education is conducted primarily through Kaplan, which provides test preparation, professional training, higher education and other educational services. Kaplan serves students and professionals in the United States and internationally.

About Chegg

Chegg, Inc. is an education technology company that provides digital learning resources and academic support to students. Its services include study and homework assistance, subject-specific learning tools, and resources for writing and citation. The company has also offered textbook rentals and sales, along with access to digital textbooks and other course materials. Chegg began as a textbook-focused business before expanding into online study services and software for students. Chegg serves students in the United States and other markets through its online platform.