Chegg Inc (NYSE:CHGG) stock price doubled in the past twelve months. This is supported by its strong financial numbers. A student-first connected learning platform, Chegg allows students to take control of their education to save money and time.
CHGG stock has the 52-week trading range of $7.21 – $19.96. Its stock rallied 14% in the last three months, up 100% from last year.
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The company has beaten revenue and earnings estimate for the fourth quarter by $2.89 million and $0.02 per share, respectively. Its non-GAAP total revenue of $60 million increased 30% year-over-year in the final quarter of fiscal 2017.
Services revenue was the most significant contributor to Cheggs total revenue. In Q4, its services revenue increased 37% over the past year quarter and that accounted for 82% of total net revenues. The company’s subscribers rose 47% to 1.4 million in the final quarter.
“2017 was our best year yet. Chegg Services revenue grew 44% year over year and we significantly improved profitability, which was driven by the leverage of our all-digital model,” said Dan Rosensweig, Chairman, and CEO of Chegg, Inc.
Chegg’s management has been working on three key strategies to expand the financial numbers:
- To generate double-digit growth in financial numbers.
- Improving and escalating the opportunities with its existing services.
- To capitalize on the new business opportunities that accelerates the growth rate.
The company expects net revenues around $295 million to $300 million in fiscal 2018, significantly higher from $255 million last year. Chegg anticipates adjusted EBITDA in the range of $76 million, compared to $46 million last year.
Its cash generation potential is enough to support the growth activities. It expects to generate operating cash flows around $55 million in 2018 when capital expenditures will account for $30 million. Thus, Chegg’s free cash flows will stand around $25 million to invest in growth opportunities. Overall, the company has been establishing footholds for the sustainable growth in the long-term.
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