Chegg price target lowered to $12 from $18 at Morgan Stanley

Morgan Stanley analyst Josh Baer lowered the firm’s price target on Chegg to $12 from $18 and keeps an Equal Weight rating on the shares. The company reported "solid" Q1 results, but this was "completely overshadowed" by management commentary regarding the threat and impacts from generative AI, the analyst tells investors. The firm has "significantly cut" its forecasts, assuming Chegg subscribers move materially lower, and it expects stable retention to deteriorate and for weak gross adds to "have an outsized impact," the analyst added.