Record Highs in the Books for CHGG After Earnings

No fewer than eight firms lifted their price targets

Assistant Editor
Feb 9, 2021 at 10:28 AM
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The shares of Chegg Inc (NYSE:CHGG) are up 3.4% at $105.50 at last check, after the education technology company reported better-than-expected fourth-quarter earnings and revenue. To follow, no fewer than eight analysts chimed in with price-target hikes, including Piper Sandler to $124 from $110. 

With its most recent pullback caught by the 40-day moving average, today's pop has CHGG breaking out of pressure at the $105 level. Now trading at fresh record highs, and earlier rising as high as $111.95, the stock is up 136% year-over-year.

Meanwhile, short interest has been on the rise, making up 12% of the stock's available float. In other words, it would take over seven days to cover these bearish bets -- a wealth of pent-up buying power. 

The options pits have been much more pessimistic than usual recently, too, per CHGG's 10-day put/call volume ratio at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which stands higher than 95% of readings from the past year. 

Today, options are taking off, with overall volume seeing 12 times what's typically seen at this point. More specifically, 6,013 calls and 4,196 puts have crossed the tape so far. The most active options is the February 110 call, where new positions are opening up, followed by the 120 call in the same series. 

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