Chegg, Inc. (NYSE:CHGG) shares traded higher on Monday after the company announced a repurchase agreement for its 0% convertible senior notes due 2026. Here's what you need to know.
What To Know: Chegg has entered into private agreements with certain noteholders to repurchase approximately $116.6 million of its outstanding 0% convertible senior notes due 2026 for a cash price of $96.2 million. The repurchase transactions were entered into as part of Chegg's previously announced securities repurchase program.
The note repurchases are expected to close on Dec. 3. Following closing, $127.9 million aggregate principal amount of the notes will remain outstanding, while $207.5 million will remain available for repurchases under the program.
The move reduces the company's outstanding debt, which appears to have contributed to Monday's positive market reaction. Chegg provides learning support services through its platform, offering AI-powered academic assistance and access to subject matter experts.
Chegg reported better-than-expected financial results for the third quarter earlier this month. Multiple analysts lowered price targets following the report, ranging from $1.50 to $3 per share.
CHGG Price Action: Chegg shares closed Monday up 12.2% at $2.26, according to Benzinga Pro.
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