Genpact (NYSE:G) & LegalZoom.com (NASDAQ:LZ) Critical Analysis

LegalZoom.com (NASDAQ:LZ – Get Free Report) and Genpact (NYSE:G – Get Free Report) are both industrials companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, valuation, institutional ownership, risk, profitability, dividends and analyst recommendations.

Earnings and Valuation

This table compares LegalZoom.com and Genpact”s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
LegalZoom.com $756.04 million 1.33 $15.43 million $0.09 65.22
Genpact $5.25 billion 1.07 $552.49 million $3.37 9.97

Genpact has higher revenue and earnings than LegalZoom.com. Genpact is trading at a lower price-to-earnings ratio than LegalZoom.com, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

82.0% of LegalZoom.com shares are held by institutional investors. Comparatively, 96.0% of Genpact shares are held by institutional investors. 7.4% of LegalZoom.com shares are held by insiders. Comparatively, 1.6% of Genpact shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Volatility and Risk

LegalZoom.com has a beta of 1.2, indicating that its share price is 20% more volatile than the S&P 500. Comparatively, Genpact has a beta of 0.57, indicating that its share price is 43% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent recommendations for LegalZoom.com and Genpact, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
LegalZoom.com 3 5 0 0 1.62
Genpact 0 7 2 0 2.22

LegalZoom.com currently has a consensus target price of $7.30, indicating a potential upside of 24.36%. Genpact has a consensus target price of $39.33, indicating a potential upside of 17.12%. Given LegalZoom.com’s higher possible upside, equities research analysts plainly believe LegalZoom.com is more favorable than Genpact.

Profitability

This table compares LegalZoom.com and Genpact’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
LegalZoom.com 2.13% 15.83% 5.08%
Genpact 11.04% 23.34% 10.68%

Summary

Genpact beats LegalZoom.com on 9 of the 14 factors compared between the two stocks.

About LegalZoom.com

(Get Free Report)

LegalZoom.com, Inc., together with its subsidiaries, operates an online platform that supports the legal, compliance, and business management needs of small businesses and consumers in the United States. The company’s platform offers business formation products, such as limited liability company, incorporation of C and S corporations, nonprofit formations, doing-business-as, corporate changes and filings, business licenses, legal forms, and beneficial ownership information reports; intellectual property products consisting of trademark and patent applications, and copyright registrations; and tax services, including business and personal tax preparations. It also provides consumer, estate planning, and other services comprising last will and testament, living will, living trust, power of attorney, and name change. In addition, the company offers subscriptions services, including registered agent, compliance, attorney advice, tax advice and preparation, eSignature, virtual mail and check deposit services, trademark monitoring, and estate planning bundle. The company was incorporated in 1999 and is headquartered in Mountain View, California.

About Genpact

(Get Free Report)

Genpact Limited provides business process outsourcing and information technology services in India, rest of Asia, North and Latin America, and Europe. It operates through three segments: Financial services; Consumer and Healthcare; and High Tech and Manufacturing. The Financial Services segment offers retail customer onboarding, customer service, collections, card servicing operations, loan and payment operations, commercial loan, equipment and auto loan, mortgage origination, compliance services, reporting and monitoring, and wealth management operations support; financial crime and risk management services; and underwriting support, new business processing, policy administration, claims management, catastrophe modeling and actuarial services, as well as property and casualty claims. The Consumer and Healthcare segment provides demand generation, sensing and planning, supply chain planning and management, pricing and trade promotion management, deduction recovery management, order management, and digital commerce; and end-to-end claim lifecycle management, from claims processing and adjudication to claims recovery and payment integrity, revenue cycle management, health equity analytics, and care services. The High Tech and Manufacturing segment offers industry-specific solutions for trust and safety, advertising sales support, customer and user experience, and customer care support; and direct and indirect procurement, logistics, field, aftermarket support, and engineering services. It also provides digital operation services; data-tech-Al services; finance and accounting services, such as accounts payable, invoice-to-cash, record to report, financial planning and analysis, and enterprise risk and compliance; CFO advisory services; supply chain, and sourcing and procurement services; sales and commercial, and marketing and experience services; and environmental, social and governance services. The company was founded in 1997 and is based in Hamilton, Bermuda.

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