Upwork (NASDAQ:UPWK – Get Rating) and LegalZoom.com (NASDAQ:LZ – Get Rating) are both mid-cap computer and technology companies, but which is the better stock? We will compare the two businesses based on the strength of their dividends, analyst recommendations, earnings, profitability, valuation, institutional ownership and risk.
Earnings and Valuation
This table compares Upwork and LegalZoom.com’s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Upwork | $502.80 million | 4.89 | -$56.24 million | ($0.44) | -43.20 |
| LegalZoom.com | $575.08 million | 5.13 | -$108.66 million | N/A | N/A |
Profitability
This table compares Upwork and LegalZoom.com’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Upwork | -11.19% | -19.76% | -6.81% |
| LegalZoom.com | -18.90% | N/A | -27.19% |
Institutional and Insider Ownership
69.6% of Upwork shares are held by institutional investors. Comparatively, 51.2% of LegalZoom.com shares are held by institutional investors. 9.2% of Upwork shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Analyst Recommendations
This is a breakdown of current ratings and target prices for Upwork and LegalZoom.com, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Upwork | 0 | 0 | 10 | 0 | 3.00 |
| LegalZoom.com | 0 | 4 | 6 | 0 | 2.60 |
Upwork presently has a consensus target price of $46.91, indicating a potential upside of 146.76%. LegalZoom.com has a consensus target price of $26.25, indicating a potential upside of 76.41%. Given Upwork’s stronger consensus rating and higher possible upside, analysts plainly believe Upwork is more favorable than LegalZoom.com.
Summary
Upwork beats LegalZoom.com on 8 of the 11 factors compared between the two stocks.
About Upwork (Get Rating)
Upwork Inc., together with its subsidiaries, operates a work marketplace that connects businesses with various independent professionals and agencies in the United States, India, the Philippines, and internationally. The company's work marketplace provides access to talent with various skills across a range of categories, including sales and marketing, customer service, data science and analytics, design and creative, web, mobile, and software development. Its work marketplace also enables clients to streamline workflows, such as talent sourcing, outreach, and contracting. The company's work marketplace offers access to various functionalities for remote engagements with talent, including communication and collaboration, ability to receive talent invoices through their work marketplace, and payment protection. Its marketplace offerings include Upwork Basic, Upwork Plus, Upwork Enterprise, and Upwork Payroll, as well as managed and internet escrow agency services. The company was formerly known as Elance-oDesk, Inc. and changed its name to Upwork Inc. in May 2015. Upwork Inc. was incorporated in 2013 and is headquartered in San Francisco, California.
About LegalZoom.com (Get Rating)
LegalZoom.com, Inc. operates an online platform for legal and compliance solutions in the United States. The company's platform offers products and services, including business formations, creating estate planning documents, protecting intellectual property, completing certain forms and agreements, providing access to independent attorney advice, and connecting customers with experts for tax preparation and bookkeeping services. It serves small businesses and individuals. The company was founded in 1999 and is headquartered in Glendale, California.
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