Online legal service provider LegalZoom (NASDAQ:LZ) will be reporting earnings tomorrow after market close. Here’s what to look for.
LegalZoom beat analysts’ revenue expectations by 2.6% last quarter, reporting revenues of $177.4 million, up 5% year on year. It was a mixed quarter for the company, with an impressive beat of analysts’ EBITDA estimates but slow revenue growth. It reported 1.61 million users, up 3.6% 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 be flat year on year at $167.5 million, slowing from the 7.7% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.15 per share.
The majority of analysts covering the company have 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 2.5% on average.
Looking at LegalZoom’s peers in the online marketplace segment, some have already reported their Q3 results, giving us a hint as to what we can expect. EverQuote delivered year-on-year revenue growth of 163%, beating analysts’ expectations by 3%, and Shutterstock reported revenues up 7.4%, topping estimates by 4.1%. Shutterstock’s stock price was unchanged following the results.
Read our full analysis of EverQuote’s results here and Shutterstock’s results here.
There has been positive sentiment among investors in the online marketplace segment, with share prices up 6.3% on average over the last month. LegalZoom is up 7.1% during the same time and is heading into earnings with an average analyst price target of $7 (compared to the current share price of $6.96).
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