Comparing Bridgepoint Education (NYSE:BPI) and Chegg (CHGG)

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Chegg (NYSE:CHGG) and Bridgepoint Education (NYSE:BPI) are both computer and technology companies, but which is the better business? We will compare the two businesses based on the strength of their analyst recommendations, profitability, valuation, institutional ownership, earnings, risk and dividends.

Insider & Institutional Ownership

77.7% of Bridgepoint Education shares are held by institutional investors. 10.8% of Chegg shares are held by insiders. Comparatively, 31.9% of Bridgepoint Education shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Risk & Volatility

Chegg has a beta of 1.51, meaning that its stock price is 51% more volatile than the S&P 500. Comparatively, Bridgepoint Education has a beta of 2.45, meaning that its stock price is 145% more volatile than the S&P 500.

Earnings and Valuation

This table compares Chegg and Bridgepoint Education’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Chegg $255.07 million 11.39 -$20.28 million ($0.09) -283.33
Bridgepoint Education $478.40 million 0.53 $10.53 million $0.59 16.02

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

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Chegg and Bridgepoint Education, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Chegg 0 6 4 1 2.55
Bridgepoint Education 0 1 1 0 2.50

Chegg presently has a consensus price target of $23.44, indicating a potential downside of 8.06%. Bridgepoint Education has a consensus price target of $14.00, indicating a potential upside of 48.15%. Given Bridgepoint Education’s higher probable upside, analysts clearly believe Bridgepoint Education is more favorable than Chegg.

Profitability

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

Net Margins Return on Equity Return on Assets
Chegg -5.01% 0.87% 0.65%
Bridgepoint Education 3.00% 12.93% 6.25%

Summary

Bridgepoint Education beats Chegg on 11 of the 15 factors compared between the two stocks.

About Chegg

Chegg, Inc. operates direct-to-student learning platform that supports students on their journey from high school to college and into their career with tools designed to help them pass their test, pass their class, and save money on required materials. The company offers Chegg Services, which include digital products and services; and required materials that comprise its print textbooks and eTextbooks. Its digital products and services include Chegg Study, which helps students master challenging concepts on their own; Chegg Writing that enables automatically generate sources in the required formats, when students need to cite their sources in written work; Chegg Tutors that allow students find human help on its learning platform through a network of live tutors; Chegg Math, an adaptive math technology and developer of the math application; Brand Partnership, which offers various ways for student-relevant brands to reach and engage high school and college students; Test Prep that provides students with an online adaptive test preparation services; and internships services. The company rents and sells print textbooks and eTextbooks; and offers supplemental materials and textbook buyback services. The company has a strategic alliance with Ingram Content Group. Chegg, Inc. was founded in 2003 and is headquartered in Santa Clara, California.

About Bridgepoint Education

Bridgepoint Education, Inc., together with its subsidiaries, provides postsecondary education services in the United States. Its academic institutions, Ashford University and University of the Rockies, offer associate's, bachelor's, master's, and doctoral degree programs in the disciplines of business, education, psychology, social sciences, and health sciences. The company offers its programs primarily through online; and at its campuses. As of December 31, 2017, its institutions offered approximately 1,200 courses and 80 degree programs; and had 45,730 students enrolled. The company was formerly known as TeleUniversity, Inc. and changed its name to Bridgepoint Education, Inc. in February 2004. Bridgepoint Education, Inc. was founded in 1999 and is headquartered in San Diego, California.

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