LZ - LegalZoom downgraded to underweight on estimate risk at Morgan Stanley

• Morgan Stanley analyst Elizabeth Porter downgraded LegalZoom ( LZ ) to Underweight from Equal Weight.
• The analyst sees risk to the company's revenue outlook given the "unfavorable outlook" for new business starts.
• Longer-term, Porter is constructive on LegalZoom "pioneering the digital disruption in legal services," which she says is an "under-digitalized market in the early days of becoming an online opportunity."
• However, in the near-term, she thinks the risk/reward is less attractive given downside to estimates.
• Porter favors names with "more durable recurring subscription software revenue and more defensible end customer exposure."
• LegalZoom's SA Quant Rating stands with Strong Sell whereas, Wall St. Analysts Rating says to Buy (2 Very Bullish, 4 Bullish).
• Since the start of 2022, LegalZoom's shares were down around 41% , and over a period of one year, shares were down around 73% .
• Shares are currently -5.93% to $9.67 today.

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