Equity Research Report | 1/14/20

EQUITY RESEARCH REPORT | 1/14/20

Recommendation: NEUTRAL CHEGG INC (Ticker: CHGG) Business Rating: 5 Security Rating: 5

Author: Janice Quek

BUSINESS RATING SECURITY RATING

SELL BUY NEGATIVE POSITIVE d

POTENTIAL FOR RETURN RISK

LIMITED SIGNIFICANT LOW HIGH d Sector: Consumer Non-Cyclicals Industry: Educational Support Stock Price: $41.21 (1/14/20) Services CEO Score: Jarvis Rank: 521

$408M Enterprise Value: $5.2B Market Cap: $4,986M Revenue Fwd (TTM): ($381.1M) Fwd (TTM) 9.6x Revenue Growth Fwd Gross Margin: 76.5% +27.1% Price/Sales: (12.7x) (YoY):

Fwd (FY20) ROIC1: 8.6% YTD Performance: +6.81% RSI: 61.2

Insider Transactions: Insiders sold 845,735 shares in the last 3 months.

 WHY WE RATE CHEGG (CHGG) A NEUTRAL  We rate shares of Chegg Inc. a NEUTRAL at this time. Online Grab-and-Go learning is gaining traction as a convenient and affordable option to THESIS learn and interact with instructors. Chegg is a leading provider of An investment in Chegg is a play on learning tools and online tutoring, and its highly affordable rates and growing demand for web-based range of services make it standout to a price-sensitive audience. The platforms that facilitate e-learning. The company is a provider of learning tools company cleverly uses technology and its textbook rental and and online tutoring services, and purchase business to push services to clients, growing its subscriber operates a textbook rental and purchase base rapidly. Chegg’s recent acquisition of Thinkful expands business. To continue to be successful, Chegg’s TAM into the professional skill learning market, where the Chegg will need to ramp subscriber growth, offer more differentiated opportunity is large. However we think that the education and services, and expand its course offerings online learning environment is intensely competitive, and some of in the professional skills learning space. Chegg’s services have little differentiation and can be easily replicated by competitors. Competitors can also start expanding their portfolio, with little difficulty, in the medium term to match Chegg’s packaged offerings. Players will likely continue to compete on price, which could create a “race to the bottom” scenario, affecting profitability growt h in the long run. While Thinkful is a strong add to the business, the company is very small and revenue contribution is minimal.

1 Using non-GAAP net income.

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 SUMMARY OF THE BUSINESS AND THE INDUSTRY  Business  Grab-and-Go Chegg Inc is a provider of an online learning platform TALKING POINTS for students. The company offers a range of services, which includes online tutoring, textbook solutions and Q&A help, writing tools, test prep and scholarship WHAT WE LIKE WHAT WE DON’T LIKE applications and textbook rental and purchases. Chegg E-learning and web- Highly competitive also ventured into the professional skills-based e- based learning services environment in a learning space, offering working professionals a way to expected to grow. price-sensitive market. upgrade their professional skills remotely. Services have little Strong subscriber differentiation and growth players compete on E-learning and web-based learning services are price. expected to grow The company is profitable, and has Expensive valuation high margins that are multiples. Learning mediums have evolved since the world projected to continue expanding. entered the digital age. The first computerized courses started in the 1960s but did not gain traction as many people did not own personal computers. After the internet arrived in the 1980s and home computers became more mainstream in the 1990s, the educational industry started creating software to provide interactive and remote learning experiences. By the early 2000s, the modern era of elearning began when educational institutions and companies began offering courses online. Since then, this space has evolved rapidly. Increasing internet penetration globally and smartphone use have made on-demand learning possible. Online tutoring and 24/7 homework help is now possible, and the availability of advanced technologies such as the use of AI, has created adaptive learning capabilities that have made remote learning highly effective, convenient and low cost. At the same time, the cost of higher education is increasing in America, and the stakes for failing to graduate are becoming higher. US news reports that in-state tuition at public colleges in the United States has increased by 243% since 1997. The debt owed by 2018 graduates averaged $30,000 per student, according to Student Loan Hero. About 37% of students do not graduate from a 4-year institution in 6 years or less, many who struggled with the workload and inadequate help with class material. The need for affordable class material and homework help to get students to complete courses and graduate is in great need today.

The professional world is also benefitting from e-learning technologies. Organizations recognize the value of continuous learning programs for their employees, and studies have shown that corporate training improve future profitability for firms. As professional courses have increased exponentially, prices have also fallen, and companies are now outsourcing their corporate training programs to e-learning companies as a cost-effective way to provide standardized, high quality, flexible and convenient training to their employees. Mid-career professionals, those transiting between jobs, and those starting out in the

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professional world are also using e-learning platforms to educate themselves to get specific jobs, taking advantage of the flexibility of remote and self-paced learning options. With clear benefits to e-learning today, it is not surprising the industry has grown by more than 900% since 2000, according to Brandon Hall Group research.

Wide range of services offered at low prices is differentiator. Entering the professional skilling market grows its market opportunity.

Chegg earns its revenue through subscription fees for Chegg Services, and a commission from selling textbooks through its partner Ingram. Under Chegg Services, the company has Chegg Study – step-by-step solutions to problems in popular textbooks and expert Q&A; Chegg Tutors – a 24/7 online tutoring service; Chegg Math Solver – a web-based software that solves math equations, Chegg Writing – a tool that helps with creating citations, check for plagiarism and grammer; and Chegg Flashcards – software that allows you to create or use a database of flashcards on a wide variety of topics. Chegg Services has one of the industry’s broadest help database. At the end of FY2018, the company had an archive of 21 million Expert Answers and 5 million Textbook Solutions. The platform that these services are based on is built on proprietary technology designed to create a direct-to-student learning experience that is also personalized for each student, builds awareness of other available services, and connects the student to other third-party partners and brands. Students’ information is also combined with external sources of publicly available and private data to push relevant services and products to the student to deepen engagement. Chegg also has a “Required Materials” business segment, which allows students to rent, or buy books and eTextbooks from its platform. Fulfilment of print textbook rentals and sales is through its partner Ingram Content Group, and Chegg earns a commission through facilitating the sale/rental. This partnership began in 2014, but management recently announced a new arrangement going forward where Chegg will end its current partnership with Ingram, and began a new working agreement with logistics provider FedEx. A shift of the textbook landscape towards consignment and eTextbooks has made the business less capital intensive, and at Chegg’s current size, it is now better able to support the capital requirements to purchase print textbooks, and build a differentiated service offering in fulfillment and shipping and delivery speed. These considerations resulted in a new partnership with FedEx, with the transition expected to complete by end of 2020.

LB•LOGIC Chegg’s “Required Materials” segment is an important business to acquire new customers and introduce Chegg’s services to them. Another new customer acquisition channel in the future is the company’s “Chegg Study Pack”, which bundles its services and provides greater value for customers.

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Chegg is also growing its portfolio in a new direction. Its recent purchase of Thinkful adds professional skills courses to its portfolio, expanding Chegg’s target audience and addressable market. Thinkful provides online technology courses for professionals desiring to enter one of the most demanded industry. Similar to Chegg’s services, it has a direct-to-student model, which means Chegg will own the content, student data and the distribution channel, allowing it to introduce new courses quickly, control the quality of the content and keep prices low. The Thinkful system not only provides the courses, it also pairs students one-on-one with a mentor and a career coach. Integrated with Chegg’s platform to provide chat-based tutoring and expert Q&A, the company believes that these offerings will not only enhance the chances of successful completion and landing a job for the student, it also creates a competitive moat in the industry. Thinkful has about 85% of their customers graduate from their programs.

LB•LOGIC We agree with management that Thinkful will differentiate Chegg from other players who are merely offering course content through partnerships with learning institutions. Under this model, dropout rates are high because dedicated help is not readily available. Moreover, margins are lower as platforms have to share revenue with their content partners. Chegg’s key differentiation in its entire business is its ability to offer on- demand high quality instructional service at very affordable students rates – a critical quality in a price-sensitive business environment.

Operational and financial metrics

Chegg’s overall performance has been mixed in the last few years as the company moved away from recognizing revenue from textbook sales and rental to recognizing a commission from its partnership with Ingram (completed in FY2017). Consequently, revenue in Chegg’s Required Materials segment varied. At the same time, its services segment expanded rapidly as the company strengthened its portfolio of services, grew its subscriber base and introduced new ways to sell its services. From an operational metric standpoint, Chegg’s annual services subscribers grew from 0.3 million in FY12 to reach 3.1 million in FY2018. While total service revenue has grown rapidly, average revenue per subscriber has shown little change, likely influenced by the recurring/non-recurring revenue mix year to year as the company tries to increase the proportion of subscribing customers. One of the ways that Chegg is trying to improve this is bundling its services. In 2019, management announced that it will be introducing a “Chegg Study Pack” in the near future to promote new customer growth, and encourage existing customers to transition for the bundle’s greater value, compared to paying for services separately. Management is confident that the study pack will not only add new subscribers, it will increase average revenue per subscriber over time.

From a profitability metric standpoint, Chegg has been growing margins steadily. Gross margin has risen to the mid to high 70+% in 2019, and EBITDA margin reached as high as 33% in Q2 2019. The company is cash flow positive and free cash flow margin continues to grow as the company scales.

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Source: Investor Presentation

FY16 FY17 FY18 Q1FY19 Q2FY19 Q3FY19 REVENUE Chegg Services (Mil) 129.3 185.7 254.0 75.3 80.3 69.3 Required Materials 124.8 69.4 67.1 22.1 13.6 24.8

Total Net Revenue 254.1 255.1 321.1 97.4 93.9 94.2 Revenue Growth (YoY) -15.70% 0.4% 25.9% 26.6% 26.5% 26.8%

OPERATIONAL METRICS No, of paying customers (Mils) 3.5 4.2 5.1 - - -

No. of active users (Mils) 6.5 11.5 14.5 - - -

No. of Chegg services subscribers 1.53 2.2 3.1 2.16 2.23 2.21 (Mil) Average revenue per subscriber 84.5 84.0 83.0 - - -

CASH & PROFITABILITY Total Gross Profit (Mils) 134.5 174.9 241.1 74.1 73.3 72.0 Total Gross Margin 52.9% 68.6% 75.1% 76.1% 78.1% 76.5%

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Adjusted EBITDA 20.8 46.4 83.3 23.9 31.1 23.1 Adjusted EBITDA Margin 8.19% 18.19% 25.94% 24.54% 33.09% 24.49%

Operating Cash Flow (Mils) 25.0 51.2 75.1 17.9 29.9 38.7 Free Cash Flow (FCF) (Mils) -0.64 25 43.9 3.9 20.5 30.7

FCF Margin -0.3% 9.8% 13.7% 4.0% 21.8% 32.6%

 Outlook/Estimates

The outlook for Chegg is generally positive as the online education industry is only starting to gain momentum. Chegg’s addressable market comprise not only high school and college-level students, but has also recently expanded to include working professionals who want to upgrade their skillset. Professional courses are currently limited to technology courses with the acquisition of Thinkful, but we expect that future acquisitions will grow its offerings into other professional areas. Moreover, Chegg is also expanding internationally, and the combined opportunity is large and relatively underpenetrated.

In the near term, management announced that the Ingram exit and transition to FedEx as a logistics provider for its Required Materials segment will compress EBITDA margins due to upfront capital requirements to acquire and own textbooks, but increase revenue due to the change in revenue recognition. About $50 million is expected to be spent in 2020 to own the textbooks and $15 million in 2021, decreasing each year after, well under current levels of operating cash flow, and a small fraction of its current cash assets on its balance sheet. As the agreement with FedEx begins in FY2020, revenue in Required Materials will increase in 2020 and 2021, but likely to stabilize in 2022. Management guided for revenue in FY2020 to be approximately $520 million or 27.4% YoY, with Chegg Services contributing $437 million2, or growth of 31.6% YoY. The inclusion of Thinkful and new product roll-outs like Chegg Study Pack is expected to drive revenue growth and average revenue per subscriber growth. Further out, as the FedEx transition completes, the company expects the new arrangement will continue to operate as a breakeven service, with little change to the total company gross profit or adjusted EBITDA. As the proportion of Chegg Services revenue increases, Chegg’s financial metrics is expected to resemble long term targets for typical Software- as-a Service (SaaS) companies. We foresee that gross margin will stabilize in the high 70+% range, with adjusted EBITDA margin and free cash flow margin reaching 30-35% and 25-30% respectively. In that scenario, Chegg could achieve ROIC in the 15-20% range.

2 This includes revenue from Thinkful which management revealed had a revenue of approximately $14 million in 2018, and growing at about the same rate as Chegg Services (~30%).

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Source: Investor Presentation

Guidance for FY2020 (Source: Investor Presentation)  Industry/Competition

Chegg competes against many companies in the educational technology industry due to the broad range of services it provides. In Chegg Study, the company competes against peers that provide study materials and online instructional systems, as well as websites that provide a Q&A service such as Yahoo! Answers and Brain.ly, and student forums. For Chegg Writing, many websites and online platforms provide similar capabilities, including Noodle Tools, Grammarly, Quetext, Duplichecket etc. Cheggs faces competition from peers such as Tutor.com, Wyzant, TutorVista and InstaEDU in the online tutoring space, and equation solver services such as Mathway and Symbolab for its Chegg Math segment. In the textbook and materials business, the company competes against college bookstores, and notable textbook rental and etextbook services such as Amazon, ecampus.com, and campusbooks.com. In the online skills-based elearning

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segment, Chegg’s Thinkful competes against other well-known and popular upskill course learning sites such as Coursera, udemy and codeacademy.com.

Chegg believes that no other company has as broad of a range of services as it provides. While Chegg’s market position in many of its business segments is unclear due to the fragmented nature of the industry, Chegg is one of two leading companies in the online tutoring space. According to market research firm, IBISWorld, there are about 1,422 businesses in the online tutoring services industry in the US alone, but Chegg and Tutor.com (owned by Korea-based ST Unitas) have the largest market share in the space. Management also reported that Chegg has about 87% of brand recognition, based on surveys conducted.

Source: Investor Presentation

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LB•LOGIC Many aspects of Chegg’s business have little service differentiation. For example, students are indifferent to the writing tool or math solver software they use or the textbook rental service they pay to use as long as it fulfils its function. As a result, the industry competes on price. Additionally, the industry’s target audience is also a price- sensitive market because of the low-paying ability of the student population. While Chegg has managed to maintain a high quality of service despite offering one of the most affordable rates in the market, the highly competitive business environment could send the industry to a race for the lowest prices, affecting Chegg’s profitability and future topline growth.

 Total Addressable Market (TAM)

Chegg estimates that there are about a total of 36 million students domestically that would benefit from Chegg’s services. The company is however expanding internationally, which would grow its target audience in the future. Market research firm Technavio projects that the global academic e-learning market will grow from $65 billion in 2018 to reach $104.5 billion in 2023, growing at a 5-yr CAGR of about 10%.

Source: Investor Presentation

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 Quality of Product/Service

Chegg has few competitors in the industry that offer the range of services it provides. Brought together, the Chegg platform provides comprehensive learning tools and services to help students learn across a wide variety of topics. The company also has a significant number of service subscribers – a metric that suggests its services are of reputable quality.  Founder/History

Chegg Inc. was founded by Josh Carlson, Aayush Phumbhra and Osman Rashid when it was incorporated in Delaware in July 2005. It started with scholarship searches, internship matching, and college application advice, and began its online print textbook rental business in 2007. Carlson left the company, leaving Rashid as its CEO, who then focused the business on textbooks. Revenues reached $10 million in January 2009. In 2010, the company hired its current CEO, Dan Rosensweig, who implemented Chegg’s current business strategy to create a direct-to-student learning platform. The company also expanded its services segment through its acquisition of Cramster in 2010 to add Chegg Study, InstaEDU in 2014 to add Chegg Tutors, internships.com in 2014 to add to its Internship service, Imagine Easy Solutions in 2016 to add Chegg Writing and programmatic advertising, Cogeon GmbH in 2017 to add Chegg Math Solver, WriteLab in 2018 to add enhanced features to Chegg Writing, and StudyBlue in 2018 which is its flashcards offering. In November 2013, Chegg concluded its IPO, with a follow-on offering in August 2017. Chegg is listed on the NYSE under the symbol “CHGG”. The company is headquartered in Santa Clara, California.

Josh Carlson was one of the original founders of Chegg Inc. The company started as a side project for him, who was then a sophomore at Iowa State University. Carlson built a site called CheggPost.com as a marketplace website for the university’s students to buy and sell items and services. The site secured funding to become Chegg Inc, but soon after the company was set up, Carlson left for another job. He took on a software developer role at TDF Corporation in 2006, and joined Ablesoft Solutions the following year. He became Director of Information Technology at the American Rental Association in March 2008 and founded PerByte Inc, a software consulting firm where he remains as CEO.

Aayush Phumbhra was one of Chegg’s co-founders. He started two companies in his native India before he moved to the United States in 2001. He joined Wells Fargo Home Mortgage as an analyst and was a management and technology consultant at BearingPoint before he founded Chegg and became its Senior Vice President. Phumbhra left in 2013 and founded another company, Nectar, a company that provides an IoT solution for the hospitality and consumer packaged goods industries.

Osman Rashid is a serial entrepreneur and one of the co-founders of Chegg. Prior to Chegg, he was Vice President of Marketing and Business Development at ATIO Corporation. He founded Gravitywell Inc. in January 2000, and moved on to be involved in business development and strategic sales for Chordiant

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Software Inc. After founding Chegg and serving as its CEO, Rashid founded another company, - Kno Inc, which was later acquired by Intel. Rashid founded Galxyz Inc., a company that makes educational apps for kids, in October 2013. In December 2015, he joined Convo.com as its CEO and Chairman.  Current Management

The following biographies were taken from the company’s annual report.

Dan Rosensweig has served as President and Chief Executive Officer since February 2010 and as the chairperson of Chegg’s board of directors from March 2010 to July 2018, and as co-chairperson of its board of directors since July 2018. From 2009 to 2010, Rosensweig served as President and Chief Executive Officer of RedOctane, a business unit of Activision Publishing, Inc. and developer, publisher and distributor of Guitar Hero. From 2007 to 2009, Mr. Rosensweig was an Operating Principal at the Quadrangle Group, a private investment firm. From 2002 to 2007, Mr. Rosensweig served as Chief Operating Officer of Yahoo! Inc., an Internet content and service provider. Prior to serving at Yahoo!, Mr. Rosensweig served as the President of CNET Networks and prior to that as Chief Executive Officer and President of ZDNet, until it was acquired by CNET Networks. Rosensweig also currently serves on the board of directors of Adobe Systems Incorporated. Mr. Rosensweig holds a B.A. in Political Science from Hobart and William Smith Colleges.

Andrew Brown has served as Chegg’s Chief Financial Officer since October 2011. From 2004 to 2009, Mr. Brown served as the Chief Financial Officer of Palm, Inc., a smartphone provider. Mr. Brown was semi- retired following his departure from Palm before he joined Chegg. Prior to serving at Palm, Mr. Brown served as the Chief Financial Officer of Pillar Data Systems, a computer data storage company, Legato Systems, a storage management company subsequently acquired by EMC, and ADPT Corporation (formerly Adaptec, Inc.). Mr. Brown also serves on the business school advisory board at Eastern Illinois University. Mr. Brown holds a B.S. in accounting from Eastern Illinois University.

Michael Osier has served as Chegg’s Chief Information Officer and Chief Outcomes Officer since December 2018 and previously served as its Chief Outcomes Officer from November 2015 to December 2018, its Chief Information Officer from October 2012 to November 2015 and its Vice President of Operations and Internet Technology from 2009 to October 2012. From 2000 to 2009, Mr. Osier served in various positions, including Vice President, Internet Technology Operations at Netflix, Inc., a multinational provider of on-demand Internet streaming media. Prior to serving at Netflix, Mr. Osier served in various senior management positions at Conner Peripherals, Seagate Technology and Quantum Corporation.

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 Capital Allocation (M&A, buybacks, expansion)

Chegg has about $1 billion in long term debt in the form of issued 0.25% and 0.125% convertible notes due 2023 and 2025 respectively. Proceeds from the debt have been used for general operations and strategic acquisitions. The company does not pay a dividend and has repurchased shares on very few occasions.

LB•LOGIC Chegg’s business expansion model has been acquiring smaller educational technology firms to add to its service line. It is not unreasonable that the company is raising funds and saving its cash for future acquisitions to grow the business. We also think that the current strategic growth direction of the firm warrants these investments to strengthen its value proposition and business prospects.

 Insider Transactions

There has been no unusual recent insider buying activity.

 TREND ANALYSIS  Valuation

Chegg trades at an expensive premium relative to peers in the education industry. Multiples are not unreasonable for the company’s revenue growth rates, business model and current profitability levels, and the outlook for the company in the near to medium term is generally positive.

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Revenue Revenue Fwd Gross Growth Forecast Forward P/E Forward P/S Margin (%) Forecast (%) (Millions USD) Chegg Inc. (CHGG) 27.40% 520 72.0 42.48 9.59 K12 Inc. (LRN) 1.08% 1027 33.7 21.06 0.82 Perdoceo Education Corp 3.30% 639.4 84.3 12.84 2.02 (PRDO) Houghton Mifflin Harcourt 2.14% 1430 45.8 - 0.51 Co. (HMHC) Rosetta Stone Inc. (RST) 8.07% 196.7 79.1 - 2.25

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 Recent Price Action

Share Price Movement

$50.00

$40.00 $40.24 $37.50 $30.00

$20.00

$10.00 200 days MAVG - Jan-18 Mar-18 May-18 Jul-18 Sep-18 Nov-18 Jan-19 Mar-19 May-19 Jul-19 Sep-19 Nov-19 Jan-20

Chegg’s stock saw some volatility in 2019, generally appreciating for the first half of the year until a significant decline in early August, when the broader market sold off on growth stocks. The stock has since recovered much of its loss. Total return in the past year is 24.7 % and total return YTD is 6.81%.

In earnings, analysts have revised next year’s EPS estimates upwards from $0.91 per share to $0.97 per share. Chegg’s current Jarvis rank is 521. Its price-vs- 20-day average is 1.007, and RSI is 61.2, suggesting upward momentum could reverse soon as the stock becomes overbought. Short interest is 16.5%.  The Last Downturn

There is little meaningful information on Chegg during the last downturn as the company was founded not long before the recession and was still starting out. Chegg also only became a public company in 2013, and financial information on the company was released only after that.

 QUALITATIVE INFORMATION  Special/Unique Characteristics of the Company

Chegg’s differentiation is its ability to offer an on-demand high quality instructional platform at very affordable rates – a critical quality in a price-sensitive business environment. Going forward, the Chegg Study Pack, a bundle of its key services, could strengthen its value proposition as it offers a comprehensive range of services at an affordable price. Chegg’s technology is also protected by patents. As of December

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31, 2018, the company had 27 issued patents which will expire between 2032 and 2036 and 22 patent applications pending in the United States.  Catalysts

Acquisition of professional online learning companies that offer courses in new subject areas and languages is likely to drive the stock price upwards. A faster than expected revenue growth, margin expansion and improving profitability metrics are also scenarios for stock price appreciation.  Risks

Chegg faces risk of data and privacy breaches that could damage its reputation and subscribers leaving the platform. A data breach occurred in September 2018 for the company, and September 2019 for its recently acquired firm Thinkful. Chegg also faces risks of competitors consolidating and being acquired by larger education firms that have greater resources to develop their service platform.

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 VISUAL REPRESENTATION OF CAPITAL STRUCTURE

Percentage of Enterprise Value

$300 Million Senior 5.9% Convertible Notes (Maturity 2023)

$700 Million Senior 13.7% Convertible Notes (Maturity 2025)

$4,899 Million Common Equity 96%

 GLOSSARY

EBITDA: Earnings Before Interest, Taxes, Depreciation, and Amortization. A measure of a company’s operating performance, which allows the investor to analyze the earning power of an enterprise without having to consider financing or accounting decisions or tax environments.

EV/EBITDA: A valuation metric intended to describe the total amount an acquirer would have to pay to purchase a company (incorporating the cost of assumed debt) per dollar of EBITDA.

Fwd: Shorthand for Forward. Generally means “Next Twelve Months”.

Market Cap: Market Capitalization. Calculated by multiplying stock price by number of outstanding shares.

ROA: Return on Assets. A measure of financial performance that shows the percentage of profit that a company earns in relation to all of its available resources (both debt and equity). Calculated by dividing Net Income by Average Total Assets.

ROE: Return on Equity. A measure of financial performance that shows the percentage of profit that a company earns for each dollar of shareholder equity. Calculated by dividing Net Income by Average Shareholder Equity.

ROIC: Return on Invested Capital. A measure of financial performance intended to evaluate a company’s growth and measure how efficiently a company is using investor funds to generate income. An ROIC of 2% or more in excess of a company’s cost of capital defines a value creator. Calculated by dividing after-tax Operating Income by the book value of all Invested Capital

TTM: Shorthand for “Trailing Twelve Months”.

YTM: Shorthand for “Yield to Maturity”. YTM is the total return expected if an investor holds a bond to maturity, with the assumption that all coupon and interest payments are made on schedule.

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