LegalZoom.com (LZ) Rebounded on Improved Results

Meridian Funds, managed by ArrowMark Partners, released its “Meridian Small Cap Growth Fund” first quarter 2025 investor letter.  A copy of the letter can be downloaded here. U.S. equities recorded their lowest quarterly performance since 2022, primarily due to uncertainty surrounding potential tariff policies. In this environment, the fund returned -12.21% (net) in the first quarter compared to the Russell 2000 Growth Index’s -11.12% return. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its first-quarter 2025 investor letter, Meridian Small Cap Growth Fund highlighted stocks such as LegalZoom.com, Inc. (NASDAQ:LZ). LegalZoom.com, Inc. (NASDAQ:LZ) is an online platform that supports the legal, compliance, and business management needs of small businesses and consumers. The one-month return of LegalZoom.com, Inc. (NASDAQ:LZ) was 1.55%, and its shares gained 9.04% of their value over the last 52 weeks.  On June 6, 2025, LegalZoom.com, Inc. (NASDAQ:LZ) stock closed at $9.17 per share, with a market capitalization of $1.661 billion.

Meridian Small Cap Growth Fund stated the following regarding LegalZoom.com, Inc. (NASDAQ:LZ) in its Q1 2025 investor letter:

“LegalZoom.com, Inc. (NASDAQ:LZ) provides legal, compliance, and tax services to small businesses through its online platform. The stock rebounded during the quarter on better-than-expected earnings and improving gross margins, reversing a series of disappointing quarters. While we remain constructive on the company’s long-term potential, particularly due to its sharpened focus on core businesses and the embrace of a subscription-based model, we reduced the position during the period based on our valuation discipline.”

Why LegalZoom.com, Inc. (LZ) is Surging On Analyst Recommendations?

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LegalZoom.com, Inc. (NASDAQ:LZ) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 32 hedge fund portfolios held LegalZoom.com, Inc. (NASDAQ:LZ) at the end of the first quarter, which was 29 in the previous quarter. LegalZoom.com, Inc.’s (NASDAQ:LZ) first quarter revenue increased 5% year-over-year to $183 million. While we acknowledge the potential of LegalZoom.com, Inc. (NASDAQ:LZ) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the undervalued AI stock set for massive gains.

In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.