LegalZoom.com

Software - Application · Technology

Price

$5.83

-0.03 (-0.43%)

Market Cap

$1.00B

Exchange

NASDAQ

Winston Score

Winston is curious

A decent business — some strong pillars, some weaker.

Data as of Aug 23, 2026 · filings through Jun 30, 2026

How the score breaks down

Quality

Good

Growth

Mixed

Cash Flow

Exceptional

Stability

Good

Valuation

Good

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Share count falling — buybacks

−6.8% over 4y

The company has reduced its share count over this period, returning value to shareholders through buybacks.

Diluted shares outstanding: 198.1M (2021) → 184.7M (2025)

Winston Score History

The full picture

LegalZoom is an online platform that helps everyday people and small businesses handle legal tasks without hiring a lawyer. Its main services include forming LLCs and corporations, filing trademarks, creating wills and trusts, and accessing subscription-based legal advice. It serves individuals and small business owners across the United States who want affordable alternatives to traditional law firms.

The company earns money through a mix of one-time fees for document filings and recurring subscription plans that give customers ongoing access to legal forms and attorney consultations. LegalZoom operates almost entirely in the U.S. and generated roughly $750 million in annual revenue in recent periods. Its brand recognition and large customer base give it a recognizable position in the online legal services market, though it faces growing competition from other legal tech platforms and DIY tools. The key growth driver is expanding its subscription business, which provides more predictable revenue, but thin operating margins leave little room for error if growth slows.

Politician Trades

2 trades / 12mo

1 Congressional buy and 1 sell on LZ in the last 12 months.

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Growth Profile

For growth stock investors

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

+6.6% YoY

YoY Growth Rate

Slow revenue growth

EPS Growth

>+1,000% YoY

YoY Growth Rate

EPS growth accelerating

R&D Spend

$82M/ year

↓ Declining (-9% vs prior year)

10.8% of revenue

Below sector average (15%)

R&D spend declining — could signal cost-cutting or efficiency

Insider Activity

32.1%ownership

→ Flat

Insider ownership roughly steady over the past year

Cash Position

Cash flow positive

$167M cash & investments

Quarterly Free Cash Flow

↑ Burn rate improving

Company generates more cash than it spends — no dilution risk from fundraising

Growth context

LegalZoom.com is growing revenue at 7% year-over-year. The Winston Score measures business quality today — these growth metrics show what could matter tomorrow.

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Score breakdown

Every number that matters to educated investors.

Each metric is explained in plain language so you know exactly what you're looking at. Start your free trial now.

Quality

Profit per sale

Gross Margin

68.2%

Premium pricing power — 68.2% gross margin

Profit after running costs

Operating Margin

5.2%

Thin — 5.2% operating margin

Return on the money invested

ROCE

27.1%

Exceptional — 27.1% return on capital

ROIC above 25%. Every dollar invested in the business earns more than 25 cents back per year.

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Growth

Sales growth

Sales YoY

+12.3%

Fast-growing sales (+12.3% YoY)

Profit growth

EPS YoY

-40.6%

Earnings shrinking (-40.6% YoY)

Earnings per share down more than 10%. Either a bad year, or a real decline.

How steady the profit is

EPS Consistency

4/8 quarters

Earnings inconsistent quarter-to-quarter

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Cash Flow

Profit that turns into cash

Cash Conversion

1320%

Turns 1320% of profit into real cash

Spare cash per sale

FCF Margin

24.1%

Converts sales into free cash efficiently (24.1%)

Free cash flow margin above 20%. Out of every $100 in sales, more than $20 is real cash they keep.

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Stability

What it owes vs what it owns

Debt / Equity

N/A

Data not available

Covers its interest

Interest Cover

19.72x

Comfortably covers interest (19.7x)

Interest coverage above 8. Profits cover interest many times over.

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Valuation

Price vs profit

P/E Ratio (TTM)

61.2x

Expensive — P/E 61.2

P/E over 35. The market is pricing in heavy, sustained growth.

Cheaper or dearer next year

P/E vs Forward

+53.6

GROWING

Earnings expected to grow meaningfully — cheaper on forward P/E (61.2 → 7.6)

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Dividends

Not applicable for this business.

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