Comparing Chegg (NYSE:CHGG) & Block (NYSE:XYZ)

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

Earnings and Valuation

This table compares Block and Chegg”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Block	$24.12 billion	1.54	$2.90 billion	$4.96	12.30
Chegg	$617.57 million	0.16	-$837.07 million	($0.72)	-1.24

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

Insider and Institutional Ownership

70.4% of Block shares are held by institutional investors. Comparatively, 95.2% of Chegg shares are held by institutional investors. 10.5% of Block shares are held by insiders. Comparatively, 3.7% of Chegg shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Block	12.99%	5.54%	3.24%
Chegg	-17.14%	-9.41%	-3.07%

Volatility and Risk

Block has a beta of 2.66, suggesting that its stock price is 166% more volatile than the S&P 500. Comparatively, Chegg has a beta of 1.99, suggesting that its stock price is 99% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and target prices for Block and Chegg, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Block	1	12	21	3	2.70
Chegg	4	1	0	1	1.67

Block currently has a consensus price target of $83.42, suggesting a potential upside of 36.72%. Chegg has a consensus price target of $1.13, suggesting a potential upside of 25.82%. Given Block’s stronger consensus rating and higher probable upside, research analysts plainly believe Block is more favorable than Chegg.

Summary

Block beats Chegg on 14 of the 15 factors compared between the two stocks.

About Block

Square, Inc. provides payment and point-of-sale solutions in the United States and internationally. The company's commerce ecosystem includes point-of-sale software and hardware that enables sellers to turn mobile and computing devices into payment and point-of-sale solutions. It offers hardware products, including Magstripe reader, which enables swiped transactions of magnetic stripe cards; Contactless and chip reader that accepts EMV® chip cards and Near Field Communication payments; Chip card reader, which accepts EMV® chip cards and enables swiped transactions of magnetic stripe cards; Square Stand, which enables an iPad to be used as a payment terminal or full point of sale solution; and Square Register that combines its hardware, point-of-sale software, and payments technology, as well as managed payments solutions. The company also provides Square Point of Sale software; Cash App, which provides access to the financial system, allowing customers to electronically send, store, and spend money; Caviar, a food ordering platform for restaurants to offer food ordering, pickup and delivery, to their customers; and Square Capital that facilitates loans to sellers based on real-time payment and point-of-sale data. Square, Inc. was founded in 2009 and is headquartered in San Francisco, California.

About Chegg

Chegg, Inc. operates a direct-to-student learning platform that helps learners build essential life and job skills to accelerate their path from learning programs in the United States and internationally. Its subscription services include Chegg Study, which offers personalized step-by-step learning support from AI, computational engines, and subject matter experts, as well as Tinger Gold and DashPash Student services; Chegg Writing that provides students with a suite of tools, such as plagiarism detection scans, grammar and writing fluency checking, expert personalized writing feedback, and premium citation generation; Chegg Math, a step-by-step math problem solver and calculator that helps students to solve problems; Chegg Study Pack, a bundle of various subscription product offerings, including Chegg Study, Chegg Writing, and Chegg Math services; and Busuu, an online language learning platform that offers comprehensive support through self-paced lessons, live classes with expert tutors, and a community of members to practice alongside. The company also provides a skills-based learning platform to learn technical skills comprising AI, coding, data analytics, and cybersecurity, as well as competencies consisting of emotional intelligence, mindset, emerging leadership, and decision making. In addition, it rents and sells print textbooks and eTextbooks; and offers advertising services. The company serves students and companies through direct marketing channels and social media. Chegg, Inc. was incorporated in 2005 and is headquartered in Santa Clara, California.