TeleTech (NASDAQ:TTEC – Get Free Report) and LegalZoom.com (NASDAQ:LZ – Get Free Report) are both small-cap industrials companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, risk, earnings, dividends, analyst recommendations, institutional ownership and profitability.
Insider & Institutional Ownership
38.0% of TeleTech shares are held by institutional investors. Comparatively, 82.0% of LegalZoom.com shares are held by institutional investors. 59.4% of TeleTech shares are held by company insiders. Comparatively, 7.4% of LegalZoom.com shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
Risk & Volatility
TeleTech has a beta of 0.9, meaning that its share price is 10% less volatile than the S&P 500. Comparatively, LegalZoom.com has a beta of 1.16, meaning that its share price is 16% more volatile than the S&P 500.
Profitability
This table compares TeleTech and LegalZoom.com’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| TeleTech | -9.96% | 30.63% | 2.12% |
| LegalZoom.com | 2.56% | 23.63% | 7.07% |
Analyst Ratings
This is a summary of recent ratings and price targets for TeleTech and LegalZoom.com, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| TeleTech | 1 | 1 | 0 | 0 | 1.50 |
| LegalZoom.com | 3 | 5 | 0 | 0 | 1.62 |
LegalZoom.com has a consensus price target of $6.12, suggesting a potential upside of 25.26%. Given LegalZoom.com’s stronger consensus rating and higher probable upside, analysts plainly believe LegalZoom.com is more favorable than TeleTech.
Earnings and Valuation
This table compares TeleTech and LegalZoom.com”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| TeleTech | $2.01 billion | 0.07 | -$192.47 million | ($4.12) | -0.72 |
| LegalZoom.com | $756.04 million | 1.07 | $15.43 million | $0.12 | 40.75 |
LegalZoom.com has lower revenue, but higher earnings than TeleTech. TeleTech is trading at a lower price-to-earnings ratio than LegalZoom.com, indicating that it is currently the more affordable of the two stocks.
Summary
LegalZoom.com beats TeleTech on 10 of the 13 factors compared between the two stocks.
About TeleTech
TeleTech, now known as TTEC Holdings, Inc. (NASDAQ:TTEC), is a global customer experience technology and services company. Founded in 1982 by Kenneth Tuchman, the company helps organizations design, build and manage customer interactions across digital and traditional channels. TTEC’s services include customer care, technical support, sales and marketing, trust and safety, consulting, artificial intelligence, automation, analytics, cloud technologies and customer experience strategy. Its offerings are delivered through a combination of customer experience software, technology platforms and outsourced business-process services.
About LegalZoom.com
LegalZoom.com, Inc. provides online legal and compliance services to individuals and small businesses. Its platform helps customers complete common legal tasks through guided tools and access to professional services. Services include forming limited liability companies and corporations, registered agent services, business compliance support, trademark applications, and personal legal documents such as wills and estate plans. The company also offers access to attorneys for legal advice and assistance.
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