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LZ · Analysis updated Nov 10, 2026, 6:00 PM ET
Why is LegalZoom.com, Inc. Common Stock (LZ) stock moving?
LegalZoom reported Q3 2026 sales of $195.1M, above the $193.8M estimate, but adjusted EPS of $0.19 missed the $0.20 estimate. The Q4 sales guide of $190M-$196M had a midpoint slightly below the $194.2M consensus, while the narrowed FY2026 guide of $797M-$803M kept the midpoint in line with the $800.1M estimate. The stock closed at $6.90 on Nov 4 and gapped down to open at $5.12 on Nov 5, closing that day at $5.96 on volume of 5.3M, well above the roughly 2-3M daily run-rate. It then slid to $4.71 by Nov 10, a drop of about 32% over four sessions, with the intraday low of $4.54 on Nov 10 marking the lowest level in the 30-day window. Analyst actions followed the same direction: BofA downgraded from Underperform to Neutral with a $6 target, JP Morgan cut its target from $7 to $6, and Citigroup cut its target from $6 to $5.50 on Nov 10. Every listed target sits above the current price, but all are cut and all ratings are Neutral or below. The Oct 29 AI assistant launch is a product positive that showed no visible price support. Heavy volume on the decline and falling targets point to continued pressure in the near term, while the in-line full-year guide offers some stability beyond the Q4 soft spot.
News behind the analysis
- Citigroup Maintains Neutral Rating and Lowers Price Target for LegalZoom.comCitigroup kept its Neutral rating on LegalZoom.com and cut its price target from $6.00 to $5.50 per share.
- Citigroup Maintains Neutral on LegalZoom.com, Lowers Price Target to $5.5Citigroup reiterated Neutral on LZ and lowered its price target to $5.50 after the Q3 2026 report.
- JP Morgan Maintains Neutral on LegalZoom.com, Lowers Price Target to $6JP Morgan kept a Neutral rating on LZ and cut its price target to $6 from $7 following the third-quarter results.
- BofA Securities Downgrades LegalZoom to NeutralBofA Securities downgraded LegalZoom.com from Underperform to Neutral and set a $6 price target.
- LegalZoom Reports Third Quarter 2026 Financial ResultsLegalZoom reported Q3 2026 revenue of $195.1 million and updated its full-year 2026 outlook.
- LegalZoom.com Sees Q4 Sales $190.000M-$196.000M vs $194.235M EstThe company guided Q4 sales to $190M-$196M, a midpoint slightly below the $194.2M consensus estimate.
- LegalZoom.com Narrows FY2026 Sales Guidance from $795.000M-$805.000M to $797.000M-$803.000M vs $800.130M EstFull-year 2026 sales guidance was narrowed to $797M-$803M, with a midpoint in line with the $800.1M estimate.
- LegalZoom.com Q3 Adj. EPS $0.19 Misses $0.20 Estimate, Sales $195.146M Beat $193.837M EstimateQ3 adjusted EPS of $0.19 missed the $0.20 estimate, while sales of $195.1M beat the $193.8M estimate.
- LegalZoom Launches AI Assistant for All CustomersLegalZoom introduced an AI assistant available to all customers in their accounts, with integrations live across major AI platforms.
About LegalZoom.com, Inc. Common Stock
LegalZoom is an online legal services platform that helps small businesses and consumers form LLCs and corporations, file trademarks, make wills and trusts, and stay compliant, with attorney help available. It blends self-service software and AI tools with an independent attorney network and its own law firm, and it is increasingly built around recurring subscriptions.
How it makes money
Two main streams. Subscriptions were about 70% of revenue in Q3 2026 (about $140M, up about 11%). They include registered agent and compliance services, legal advisory plans, virtual mail and tax/bookkeeping help. One-time transaction fees made up the other roughly 30% (about $55M, down about 14%), mainly for business formations, trademarks and estate-planning documents. Full-year 2026 revenue is guided to about $800M.
What usually moves LZ
- New business formation volumes
- Customer acquisition costs as search traffic shifts to AI
- Subscription growth and retention
- Guidance changes and cost cuts
- Competition from low-cost online filing services