What Caused LegalZoom (LZ) Stock to Surge More Than 25% After Market Close?

Written by Emily J. Thompson, Senior Investment Analyst

LZ-2.41%

Source: Benzinga

Updated: Nov 06 2025

0mins

Source: Benzinga

Stock Performance: LegalZoom.com Inc. shares surged 25.31% to $12.75 in after-hours trading following a strong third-quarter earnings report.
Record Revenue: The company reported a record third-quarter revenue of $190.2 million, a 13% increase from the previous year, with subscription and transaction revenues also rising.
Increased Guidance: LegalZoom raised its full-year revenue guidance to between $748 million and $752 million, anticipating a 10% year-over-year growth.
Strategic Focus and Cash Flow: The company is leveraging AI and technology to target small businesses, while also reporting a significant increase in free cash flow to $46.99 million for the quarter.

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LZ

$8.89+Infinity%1D

Analyst Views on LZ

Wall Street analysts forecast LZ stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for LZ is 12.42 USD with a low forecast of 9.00 USD and a high forecast of 15.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.

7 Analyst Rating

4 Buy

2 Hold

1 Sell

Moderate Buy

Current: 9.110

Low

9.00

Averages

12.42

High

15.00

Current: 9.110

Low

9.00

Averages

12.42

High

15.00

Citi

Neutral

downgrade

$12

2025-11-21

Reason

Citi

Price Target

$12

AI Analysis

2025-11-21

downgrade

Neutral

Reason

Citi lowered the firm's price target on LegalZoom to $10.50 from $12 and keeps a Neutral rating on the shares.

Morgan Stanley

Underweight

maintain

$9

2025-11-13

Reason

Morgan Stanley

Price Target

$9

2025-11-13

maintain

Underweight

Reason

Morgan Stanley raised the firm's price target on LegalZoom to $9 from $8.50 and keeps an Underweight rating on the shares. The firm revised its estimates and price targets following calendar Q3 results last week for LegalZoom and several other software names it covers.

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About LZ

LegalZoom.com, Inc. provides an online platform for legal services, transforming how individuals and small businesses navigate the legal system. The Company offers the tools and guidance people need to confidently manage everything from business formation and compliance to estate planning and ongoing legal support. Its platform includes professional expertise and other products, both legal and non-legal, to meet the needs of small businesses. Its offerings include ongoing compliance, business licenses, accounting, virtual mailbox and e-signature solutions, trademark filings, and estate plans. Its transaction products for small businesses include business formation and intellectual property. Its transaction products for consumers include consumer, estate planning and other. Its compliance subscriptions provide assistance with state-mandated regulatory filings, such as corporate annual reports. The Company operates across 50 states and in over 3,000 counties in the United States.

About the author

Emily J. Thompson

Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.

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