Canadian Tire vs Chegg Which Is a Better Investment?

Canadian Tire and Chegg are two well-known companies in the stock market with distinct business models. Canadian Tire, a retailer of automotive, hardware, and sports equipment, has a long history of providing quality products to consumers. On the other hand, Chegg is an education technology company that offers services such as textbook rentals and online tutoring. Both companies have seen fluctuations in their stock prices over the years, making them attractive options for investors looking to diversify their portfolios.

Canadian Tire or Chegg?

When comparing Canadian Tire and Chegg, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Canadian Tire and Chegg.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Canadian Tire has a dividend yield of 4.76%, while Chegg has a dividend yield of -%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Canadian Tire reports a 5-year dividend growth of 11.12% year and a payout ratio of 55.13%. On the other hand, Chegg reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Canadian Tire P/E ratio at 13.15 and Chegg's P/E ratio at -0.28. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Canadian Tire P/B ratio is 1.49 while Chegg's P/B ratio is 1.23.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Canadian Tire has seen a 5-year revenue growth of 0.36%, while Chegg's is 1.17%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Canadian Tire's ROE at 11.54% and Chegg's ROE at -133.62%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $107.40 for Canadian Tire and $2.09 for Chegg. Over the past year, Canadian Tire's prices ranged from $91.50 to $120.47, with a yearly change of 31.66%. Chegg's prices fluctuated between $1.34 and $11.48, with a yearly change of 756.72%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.