LegalZoom.com (NASDAQ:LZ) Cut to Hold at Wall Street Zen

Key Points

• LegalZoom.com was downgraded to “hold” by Wall Street Zen, adding to a mixed analyst view on the stock. The company now has an average “hold” rating and an average price target of $8.25.
• Recent earnings were mixed: LegalZoom reported $0.12 EPS, missing estimates by $0.01, while revenue of $206.78 million topped expectations and rose 12.9% year over year.
• Insider selling and institutional buying both stood out, with CFO Noel Bertram Watson and insider Nicole Miller selling shares, while large investors like Goldman Sachs and Bank of America significantly increased their holdings.

LegalZoom.com (NASDAQ:LZ - Get Free Report) was downgraded by equities research analysts at Wall Street Zen from a "buy" rating to a "hold" rating in a research report issued to clients and investors on Saturday.

Several other analysts have also issued reports on the company. UBS Group cut their target price on LegalZoom.com from $8.00 to $7.00 and set a "neutral" rating for the company in a research note on Thursday, May 7th. JPMorgan Chase & Co. decreased their price target on shares of LegalZoom.com from $11.00 to $8.00 and set an "overweight" rating on the stock in a research note on Wednesday, June 24th. Citigroup lowered their price objective on shares of LegalZoom.com from $8.50 to $7.50 and set a "neutral" rating for the company in a report on Friday, May 22nd. Finally, Weiss Ratings cut shares of LegalZoom.com from a "hold (c-)" rating to a "sell (d+)" rating in a research note on Monday, April 6th. Three research analysts have rated the stock with a Buy rating, three have assigned a Hold rating and three have assigned a Sell rating to the company. Based on data from MarketBeat.com, the company has an average rating of "Hold" and an average target price of $8.25.

LegalZoom.com Price Performance

Shares of LZ stock opened at $6.92 on Friday. The business has a 50-day moving average price of $6.15 and a two-hundred day moving average price of $7.16. LegalZoom.com has a 12-month low of $5.22 and a 12-month high of $12.40. The firm has a market cap of $1.19 billion, a P/E ratio of 115.35, a price-to-earnings-growth ratio of 1.22 and a beta of 1.31.

LegalZoom.com (NASDAQ:LZ - Get Free Report) last posted its quarterly earnings data on Wednesday, May 6th. The company reported $0.12 earnings per share (EPS) for the quarter, missing analysts' consensus estimates of $0.13 by ($0.01). The firm had revenue of $206.78 million during the quarter, compared to analysts' expectations of $202.14 million. LegalZoom.com had a return on equity of 11.53% and a net margin of 1.46%.LegalZoom.com's revenue for the quarter was up 12.9% compared to the same quarter last year. During the same quarter in the previous year, the company posted $0.13 earnings per share. As a group, research analysts expect that LegalZoom.com will post 0.32 EPS for the current fiscal year.

Insider Activity

In related news, CFO Noel Bertram Watson sold 15,000 shares of the firm's stock in a transaction that occurred on Monday, May 18th. The stock was sold at an average price of $6.45, for a total transaction of $96,750.00. Following the transaction, the chief financial officer directly owned 2,041,847 shares in the company, valued at $13,169,913.15. This trade represents a 0.73% decrease in their position. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, insider Nicole Miller sold 19,199 shares of LegalZoom.com stock in a transaction that occurred on Tuesday, May 19th. The stock was sold at an average price of $6.58, for a total value of $126,329.42. Following the completion of the transaction, the insider directly owned 1,119,222 shares in the company, valued at $7,364,480.76. This trade represents a 1.69% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. 5.90% of the stock is currently owned by corporate insiders.

Institutional Trading of LegalZoom.com

A number of institutional investors have recently made changes to their positions in LZ. Goldman Sachs Group Inc. raised its holdings in LegalZoom.com by 165.3% during the 4th quarter. Goldman Sachs Group Inc. now owns 3,730,487 shares of the company's stock valued at $37,044,000 after buying an additional 2,324,481 shares during the last quarter. Boston Partners bought a new stake in LegalZoom.com in the 3rd quarter worth $20,686,000. Bank of America Corp DE increased its position in shares of LegalZoom.com by 187.4% in the first quarter. Bank of America Corp DE now owns 2,509,891 shares of the company's stock valued at $14,231,000 after acquiring an additional 1,636,487 shares during the period. Qube Research & Technologies Ltd increased its position in shares of LegalZoom.com by 180.5% in the second quarter. Qube Research & Technologies Ltd now owns 1,797,252 shares of the company's stock valued at $16,014,000 after acquiring an additional 1,156,462 shares during the period. Finally, Norges Bank bought a new position in shares of LegalZoom.com during the fourth quarter valued at about $10,526,000. Hedge funds and other institutional investors own 81.99% of the company's stock.

About LegalZoom.com

LegalZoom.com, Inc NASDAQ: LZ operates as a leading online legal technology company that provides a broad range of legal and business services to individuals, families and small businesses. Through its digital platform, the company offers customized legal documents and filing services, including business formation (LLCs, corporations and nonprofits), estate planning (wills and trusts), intellectual property protection (trademarks and copyrights), and ongoing compliance support. LegalZoom also connects customers with independent attorneys for consultations on matters such as family law, immigration and real estate.

Founded in 2001 by entrepreneurs Brian Lee, Brian P.

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