LegalZoom.com, Inc.
$6.53
-7.4%LegalZoom.com, Inc. operates an online platform for legal and compliance solutions in the United States. The company's platform offers products and services, including business formations, creating estate planning documents, protecting intellectual property, completing certain forms and agreements, providing access to independent attorney advice, and connecting customers with experts for tax preparation and bookkeeping services. It serves small businesses and individuals. LegalZoom.com, Inc. was incorporated in 1999 and is headquartered in Glendale, California.
At a Glance
Live SnapshotIntrinsic Alpha Methodology
Thesis Lenses
Signal
High confidenceValuation multiple is elevated (P/E 115.1).
Valuation inputs: P/E 115.1, earnings yield +0.9%, momentum -7.4%.
If multiples stay elevated while momentum fades, downside repricing risk rises.
Driver
High confidenceReturn profile is soft (ROE +9.0%, ROIC +3.1%).
Profitability stack: net margin +2.0%, ROE +9.0%, ROIC +3.1%.
Quality deterioration often appears in margins before it shows up in headline EPS.
Risk
High confidenceDownside profile is elevated and scenario stress-testing is essential.
Risk factors: liabilities/assets +67.6%, momentum -7.4%, net margin +2.0%.
Higher leverage with weak momentum and thin margins can amplify drawdown severity.
LegalZoom.com, Inc. Market vs Earnings Trajectory
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LegalZoom.com, Inc. Fair Value Envelope
LegalZoom.com, Inc. Profit Bridge
Profitability Analysis
Gross Margin
Exceptional pricing power and cost management. The company retains over half of revenue after direct costs.
Operating Margin
Minimal operating profit suggests high operating costs or pricing challenges. Scalability is concerning.
Net Profit Margin
Minimal profitability after all expenses. Limited financial flexibility for reinvestment or shareholder returns.
Effective Tax Rate
Higher tax burden may reflect limited tax optimization or operations in high-tax jurisdictions.
Profitability Insight
Margin squeeze alert: Healthy gross margins but weak operating margins suggest excessive operating expenses. Cost optimization could unlock significant value.
LegalZoom.com, Inc. Cash Conversion Engine
Cash Flow Quality Analysis
FCF Conversion Rate
Excellent cash generation. The company converts earnings to cash at or above 100%, indicating high-quality earnings.
CapEx Intensity
Asset-light business model. Low capital requirements leave more cash available for shareholders and growth investments.
FCF Growth Trend
Strong FCF growth demonstrates improving cash generation and business momentum. Positive signal for sustainability.
Working Capital Impact
Working capital inflow boosted cash flow. Efficient management of receivables, inventory, and payables contributing positively.
Cash Flow Quality Insight
Exceptional cash generation: High-quality earnings converting to growing free cash flow. The company demonstrates strong pricing power, efficient operations, and disciplined capital allocation.
LegalZoom.com, Inc. Funding & Solvency Profile
Financial Health Analysis
Current Ratio
Warning: Liquidity concerns. Current assets may not be sufficient to cover short-term obligations.
Debt-to-Equity Ratio
High financial leverage. Heavy reliance on debt may indicate increased financial risk and potential solvency concerns.
Working Capital
Negative working capital indicates short-term liabilities exceed short-term assets—potential liquidity stress.
Asset Composition
Balanced asset mix between current and non-current assets, typical of many stable businesses.
Financial Health Insight
Financial stress indicators: Both liquidity and leverage metrics raise concerns. The company may face challenges meeting obligations and should focus on strengthening its balance sheet.
LegalZoom.com, Inc. Street Expectations Map
Wall Street analysts project that LZ stock may rise significantly over the coming 12 months. The consensus 1-year price target stands at 8.17, with estimates ranging from a low of 6.50 to a high of 10.00.
The consensus 1-year price target stands at 8.17, with estimates ranging from a low of 6.50 to a high of 10.00.
Analyst Consensus Analysis
Upside Potential
Substantial upside potential. Analysts see significant value gap, suggesting the stock may be materially undervalued at current levels.
Analyst Agreement
Mixed analyst views. Wide target range suggests differing opinions on key value drivers, growth prospects, or risk factors.
Risk-Reward Profile
Favorable risk-reward. Potential upside significantly exceeds downside risk, offering asymmetric return profile attractive for risk-tolerant investors.
Analyst Conviction
Neutral sentiment. Fair value pricing with moderate agreement suggests wait-and-see approach or catalyst-driven opportunity.
Market Sentiment Insight
Asymmetric upside: Strong return potential with favorable risk-reward profile. The limited downside relative to upside makes this an attractive risk-adjusted opportunity for growth-oriented portfolios.
LegalZoom.com, Inc. Insider Positioning
During the last 12 months, insiders have purchased $769K and sold $2.05M worth of LZ shares, resulting in $1.28M of net selling activity.
3 Months
125.0K
768.99K
34.2K
223.10K
+546K
+$546K
3-6 Months
0
0.00
38.3K
259.06K
-259K
-$259K
6-9 Months
0
0.00
38.5K
369.82K
-370K
-$370K
9-12 Months
0
0.00
109.9K
1.19M
-1.2M
-$1.19M
Top Buyers
Stibel Jeffrey M
Director, Officer: Chief Executive Officer
$769K
Top Sellers
Watson Noel Bertram
Officer: Chief Operating Officer & Cfo
$1.01M
Miller Nicole
Officer: Chief Legal Officer
$780K
Murphy John Francis
Director
$256K
Insider Activity Analysis
Net Insider Sentiment
Negative insider sentiment with $1.28M net selling. Selling notably exceeds buying, warranting closer scrutiny of company fundamentals.
Buy/Sell Ratio
Weak buy/sell ratio. Selling significantly exceeds buying—monitor for potential fundamental concerns.
Recent Trend (3 Months)
Very strong recent buying momentum. Recent insider purchases significantly outpace sales, suggesting near-term optimism.
Insider Participation
3 insider sellers vs. 1 buyers. Widespread selling across multiple insiders may signal concerns.
lz Dividend History
Learning Layer
Related Guides
Build conviction on LZ by pairing this stock hub with focused valuation guides.
Research Paths
Snapshot
Start with context, operating signals, and key market metrics.
Value Model
Stress test fair value across bear, base, and bull assumptions.
Statements
Validate revenue quality, margins, and balance sheet durability.
Earnings Call
Read management commentary and compare it with reported outcomes.
Dividends
Check payout sustainability and long-term distribution behavior.
Analyst Expectations
Review consensus spread and where estimate risk is concentrated.