LegalZoom.com (NASDAQ:LZ) Stock Falls 5% – Should You Sell?

LegalZoom.com, Inc. (NASDAQ:LZ) traded down 5% during trading on Tuesday. The stock traded as low as $6.74 and last traded at $6.7080. 564,248 shares traded hands during trading, a decline of 81% from the average session volume of 2,995,958 shares. The stock had previously closed at $7.06.

Analysts Set New Price Targets

LZ has been the topic of several research reports. William Blair downgraded shares of LegalZoom.com from an “outperform” rating to a “market perform” rating in a report on Thursday, August 6th. JPMorgan Chase & Co. reiterated a “neutral” rating and set a $7.00 price objective (down from $8.00) on shares of LegalZoom.com in a research report on Thursday, August 6th. Wall Street Zen upgraded LegalZoom.com from a “hold” rating to a “buy” rating in a report on Saturday, September 26th. Finally, Weiss Ratings upgraded LegalZoom.com from a “sell (d+)” rating to a “hold (c-)” rating in a research note on Wednesday, October 14th. Six investment analysts have rated the stock with a Hold rating and two have assigned a Sell rating to the company’s stock. According to data from MarketBeat.com, the company currently has a consensus rating of “Reduce” and an average target price of $7.30.

LegalZoom.com Price Performance

The company has a market cap of $1.16 billion, a PE ratio of 74.72, a PEG ratio of 1.31 and a beta of 1.20. The firm’s 50 day moving average is $6.03 and its 200 day moving average is $6.65.

LegalZoom.com (NASDAQ:LZ) last released its quarterly earnings results on Wednesday, August 5th. The company reported $0.16 EPS for the quarter, topping analysts’ consensus estimates of $0.15 by $0.01. The business had revenue of $205.29 million during the quarter, compared to analysts’ expectations of $205.83 million. LegalZoom.com had a net margin of 2.13% and a return on equity of 15.83%. The business’s quarterly revenue was up 6.6% compared to the same quarter last year. During the same quarter in the previous year, the company earned $0.15 EPS. As a group, analysts anticipate that LegalZoom.com, Inc. will post 0.32 EPS for the current year.

Insiders Place Their Bets

In related news, CFO Noel Watson sold 416,371 shares of LegalZoom.com stock in a transaction that occurred on Thursday, August 20th. The stock was sold at an average price of $5.91, for a total transaction of $2,460,752.61. Following the sale, the chief financial officer directly owned 1,491,430 shares in the company, valued at $8,814,351.30. The trade was a 21.82% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which is available through this hyperlink. Also, insider Nicole Miller sold 43,996 shares of the company’s stock in a transaction dated Monday, August 17th. The stock was sold at an average price of $5.51, for a total transaction of $242,417.96. Following the completion of the sale, the insider directly owned 976,932 shares in the company, valued at $5,382,895.32. This represents a 4.31% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. 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. Over the last three months, insiders have sold 577,475 shares of company stock worth $3,375,197. Insiders own 7.40% of the company’s stock.

Hedge Funds Weigh In On LegalZoom.com

Several institutional investors and hedge funds have recently modified their holdings of the stock. Squarepoint Ops LLC raised its holdings in LegalZoom.com by 289.3% in the second quarter. Squarepoint Ops LLC now owns 269,974 shares of the company’s stock worth $1,655,000 after buying an additional 200,618 shares during the last quarter. Bank of America Corp DE boosted its stake in shares of LegalZoom.com by 187.4% in the 1st quarter. Bank of America Corp DE now owns 2,509,891 shares of the company’s stock worth $14,231,000 after buying an additional 1,636,487 shares during the last quarter. Pacer Advisors Inc. grew its stake in shares of LegalZoom.com by 53.6% during the 1st quarter. Pacer Advisors Inc. now owns 926,425 shares of the company’s stock valued at $5,253,000 after purchasing an additional 323,201 shares during the period. Healthcare of Ontario Pension Plan Trust Fund purchased a new stake in shares of LegalZoom.com in the 1st quarter worth $1,923,000. Finally, Hawk Ridge Capital Management LP raised its stake in shares of LegalZoom.com by 48.7% in the first quarter. Hawk Ridge Capital Management LP now owns 735,929 shares of the company’s stock worth $4,173,000 after buying an additional 241,100 shares during the period. 81.99% of the stock is currently owned by institutional investors.

LegalZoom.com Company Profile

LegalZoom.com, Inc is an online platform that provides legal, compliance and tax-related products and services to individuals, families and small businesses. The company’s platform is designed to make common legal and administrative processes more accessible through digital tools, guided services and access to independent professionals.

LegalZoom’s offerings include business formation services for limited liability companies and corporations, registered-agent services, annual compliance support, business licensing and trademark services.