Chegg Inc's score of 71 means it scores higher than 71% of stocks in the industry. Chegg Inc also received an overall rating of 58, putting it in the top 20% of stocks in the industry. This is an impressive rating, and it shows that Chegg Inc is a reliable stock. The company has a market capitalization of $13.4 billion and is listed on the New York stock Exchange.
Today we will run through one way of estimating the intrinsic value of Chegg, Inc. (NYSE:CHGG) by taking the forecast future cash flows of the company and discounting them to today's value. This method is known as the discounted cash flow (DCF) analysis. The goal of this analysis is to provide an estimate of the company's value based on its potential future earnings.
The first step in the DCF analysis is to determine the company's free cash flow. This is the amount of money that the company has left over after all operating expenses have been paid. Chegg Inc's free cash flow for the last 12 months was $541 million. The second step is to determine the discount rate, which is the rate of return that the company must earn to make the investment worthwhile.