LegalZoom.com (NASDAQ:LZ) Stock Rating Lowered by Bank of America

LegalZoom.com (NASDAQ:LZ) was downgraded by research analysts at Bank of America from a “buy” rating to an “underperform” rating in a note issued to investors on Thursday, MarketBeat.com reports.

LZ has been the subject of a number of other 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. cut shares of LegalZoom.com from an “overweight” rating to a “neutral” rating and lowered their target price for the company from $8.00 to $7.00 in a research note on Thursday, August 6th. Wall Street Zen raised shares of LegalZoom.com from a “hold” rating to a “buy” rating in a research report on Saturday, September 26th. Finally, Weiss Ratings downgraded LegalZoom.com from a “hold (c-)” rating to a “sell (d+)” rating in a report on Thursday, October 29th. Five research analysts have rated the stock with a Hold rating and four have given a Sell rating to the company. According to data from MarketBeat.com, the stock has a consensus rating of “Reduce” and a consensus price target of $7.10.

LegalZoom.com Trading Down 11.9%

LZ stock traded down $0.71 during trading on Thursday, reaching $5.24. 3,716,687 shares of the stock were exchanged, compared to its average volume of 2,448,845. LegalZoom.com has a twelve month low of $5.10 and a twelve month high of $10.88. The company has a market capitalization of $897.40 million, a P/E ratio of 43.67, a price-to-earnings-growth ratio of 1.30 and a beta of 1.16. The stock has a 50 day simple moving average of $6.15 and a 200-day simple moving average of $6.50.

LegalZoom.com (NASDAQ:LZ) last posted its quarterly earnings results on Wednesday, November 4th. The company reported $0.19 EPS for the quarter, meeting the consensus estimate of $0.19. LegalZoom.com had a return on equity of 15.83% and a net margin of 2.13%. The firm had revenue of $195.15 million during the quarter, compared to analysts’ expectations of $193.83 million. During the same quarter in the prior year, the firm posted $0.17 EPS. The company’s revenue for the quarter was up 2.6% on a year-over-year basis. Equities analysts predict that LegalZoom.com will post 0.32 EPS for the current year.

Insiders Place Their Bets

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

Institutional Trading of LegalZoom.com

Several large investors have recently added to or reduced their stakes in the company. State Street Corp boosted its holdings in shares of LegalZoom.com by 3.0% in the 2nd quarter. State Street Corp now owns 4,552,468 shares of the company’s stock worth $27,907,000 after acquiring an additional 132,761 shares in the last quarter. Dimensional Fund Advisors LP boosted its stake in LegalZoom.com by 3.0% in the first quarter. Dimensional Fund Advisors LP now owns 3,112,895 shares of the company’s stock worth $17,650,000 after purchasing an additional 91,131 shares in the last quarter. Punch & Associates Investment Management Inc. grew its holdings in shares of LegalZoom.com by 6.0% during the second quarter. Punch & Associates Investment Management Inc. now owns 2,850,501 shares of the company’s stock worth $17,474,000 after purchasing an additional 161,231 shares during the last quarter. Bank of America Corp DE grew its holdings in shares of LegalZoom.com by 187.4% during the first quarter. Bank of America Corp DE now owns 2,509,891 shares of the company’s stock worth $14,231,000 after purchasing an additional 1,636,487 shares during the last quarter. Finally, Principal Financial Group Inc. increased its stake in shares of LegalZoom.com by 579.1% in the first quarter. Principal Financial Group Inc. now owns 1,010,914 shares of the company’s stock valued at $5,732,000 after buying an additional 862,045 shares in the last quarter. 81.99% of the stock is owned by institutional investors.

Key LegalZoom.com News

Here are the key news stories impacting LegalZoom.com this week:

• Positive Sentiment: Q3 revenue of $195.15 million topped the $193.83 million estimate, while earnings of $0.19 per share matched the reported consensus and rose from $0.17 a year earlier. Q3 earnings results
• Neutral Sentiment: LegalZoom projected $180 million–$185 million in adjusted EBITDA for 2026, while noting pressure from search and targeted investments. 2026 EBITDA outlook
• Negative Sentiment: Business-formation volume fell 13% year over year to 110,000, a sign of weaker demand; human-in-the-loop subscriptions accounted for 49% of Q3 revenue. Long-term investor takeaways
• Negative Sentiment: Bank of America cut its rating from Buy to Underperform. JPMorgan lowered its price target from $7 to $6 and kept a Neutral rating, adding to concerns about the outlook. Stock crosses below 200-day moving average after downgrade

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.