Online legal service provider LegalZoom (NASDAQ:LZ) will be reporting earnings tomorrow after market hours. Here's what investors should know.
LegalZoom met analysts' revenue expectations last quarter, reporting revenues of $174.2 million, up 5% year on year. It was a weak quarter for the company, with slow revenue growth and full-year revenue guidance missing analysts' expectations. It reported 1.61 million users, up 6.9% year on year.
Is LegalZoom a buy or sell going into earnings? Read our full analysis here, it's free.
This quarter, analysts are expecting LegalZoom's revenue to grow 2.4% year on year to $172.9 million, slowing from the 3.8% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.09 per share.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. LegalZoom has only missed Wall Street's revenue estimates once over the last two years, exceeding top-line expectations by 2.3% on average.
Looking at LegalZoom's peers in the online marketplace segment, some have already reported their Q2 results, giving us a hint as to what we can expect. MercadoLibre delivered year-on-year revenue growth of 41.5%, beating analysts' expectations by 8.3%, and EverQuote reported revenues up 72.3%, topping estimates by 13.9%. MercadoLibre traded up 10.7% following the results.
Read our full analysis of MercadoLibre's results here and EverQuote's results here.
Growth stocks have seen elevated volatility as investors debate the Fed's monetary policy, and while some of the online marketplace stocks have fared somewhat better, they have not been spared, with share prices down 6.6% on average over the last month. LegalZoom is down 25% during the same time and is heading into earnings with an average analyst price target of $7.3 (compared to the current share price of $5.98).
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