Is Chegg Inc (CHGG) A Good Stock To Buy Right Now?

As one would reasonably expect, key money managers were breaking ground themselves. G2 Investment Partners Management, led by Josh Goldberg, assembled the most outsized position in Chegg Inc (NYSE:CHGG). G2 Investment Partners Management had $1.3 million invested in the company at the end of the quarter. Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital also initiated a $0.3 million position during the quarter. The other funds with new positions in the stock are Mike Vranos’s Ellington, Israel Englander’s Millennium Management, and Paul Marshall and Ian Wace’s Marshall Wace LLP.

Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Chegg Inc (NYSE:CHGG) but similarly valued. We will take a look at Intrawest Resorts Holdings Inc (NYSE:SNOW), Endeavour Silver Corp. (CAN) (NYSE:EXK), Vitamin Shoppe Inc (NYSE:VSI), and Chase Corporation (NYSEAMEX:CCF). This group of stocks’ market caps resemble CHGG’s market cap.

As you can see these stocks had an average of 9.75 hedge funds with bullish positions and the average amount invested in these stocks was $67 million. That figure was $85 million in CHGG’s case. Vitamin Shoppe Inc (NYSE:VSI) is the most popular stock in this table. On the other hand Endeavour Silver Corp. (CAN) (NYSE:EXK) is the least popular one with only 8 bullish hedge fund positions. Chegg Inc (NYSE:CHGG) shares the top spot with VSI. However, since both stocks have similar market caps and hedge fund position total in VSI is 50% more than their position in VSI, we are leaning towards VSI. CHGG also outperformed VSI in recent months and now trades at a richer forward valuation. That’s why we don’t think it is a good idea to initiate a new position in CHGG right now.

Disclosure: none