As the Q3 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the online marketplace industry, including LegalZoom (NASDAQ: LZ) and its peers.
Marketplaces have existed for centuries. Where once it was a main street in a small town or a mall in the suburbs, sellers benefitted from proximity to one another because they could draw customers by offering convenience and selection. Today, a myriad of online marketplaces fulfill that same role, aggregating large customer bases, which attracts commission-paying sellers, generating flywheel scale effects that feed back into further customer acquisition.
The 13 online marketplace stocks we track reported a satisfactory Q3. As a group, revenues beat analysts’ consensus estimates by 2.8% while next quarter’s revenue guidance was in line.
Luckily, online marketplace stocks have performed well with share prices up 37.7% on average since the latest earnings results.
LegalZoom (NASDAQ: LZ)
Founded by famous lawyer Robert Shapiro, LegalZoom (NASDAQ: LZ) offers online legal services and documentation assistance for individuals and businesses.
LegalZoom reported revenues of $168.6 million, flat year on year. This print exceeded analysts’ expectations by 0.6%. Overall, it was a strong quarter for the company with a solid beat of analysts’ EBITDA estimates and full-year EBITDA guidance exceeding analysts’ expectations.
“I am pleased with the early strides we are making against our key execution priorities,” said Jeff Stibel, Chairman and Chief Executive Officer of LegalZoom.
The stock is up 12.8% since reporting and currently trades at $9.18.
Is now the time to buy LegalZoom? Access our full analysis of the earnings results here, it’s free.
Best Q3: Shutterstock (NYSE: SSTK)
Originally featuring a library that included many of founder Jon Oringer’s photos, Shutterstock (NYSE: SSTK) is now a digital platform where customers can license and use hundreds of millions of pieces of content.
Shutterstock reported revenues of $250.6 million, up 7.4% year on year, outperforming analysts’ expectations by 5.1%. The business had a very strong quarter with an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ number of paid downloads estimates.
Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 1.9% since reporting. It currently trades at $28.95.
Is now the time to buy Shutterstock? Access our full analysis of the earnings results here, it’s free.
Weakest Q3: MercadoLibre (NASDAQ: MELI)
Originally started as an online auction platform, MercadoLibre (NASDAQ: MELI) is a one-stop e-commerce marketplace and fintech platform in Latin America.
MercadoLibre reported revenues of $5.31 billion, up 35.3% year on year, exceeding analysts’ expectations by 2.5%. Still, it was a slower quarter as it posted a significant miss of analysts’ EBITDA estimates.
The stock is flat since the results and currently trades at $2,123.
Read our full analysis of MercadoLibre’s results here.
CarGurus (NASDAQ: CARG)
Bringing transparency to a sometimes opaque process, CarGurus (NASDAQ: CARG) is a digital marketplace where auto dealers can connect with potential customers and where car buyers can browse, purchase, and obtain financing.
CarGurus reported revenues of $231.4 million, up 5.4% year on year. This result topped analysts’ expectations by 3.2%. Taking a step back, it was a mixed quarter as it also produced a solid beat of analysts’ EBITDA estimates but revenue guidance for next quarter missing analysts’ expectations significantly.
The company reported 31,684 users, up 1.6% year on year. The stock is up 19.1% since reporting and currently trades at $39.77.
Read our full, actionable report on CarGurus here, it’s free.
eBay (NASDAQ: EBAY)
Originally known as the first online auction site, eBay (NASDAQ: EBAY) is one of the world’s largest online marketplaces.
eBay reported revenues of $2.58 billion, up 3% year on year. This print beat analysts’ expectations by 1.1%. Zooming out, it was a slower quarter as it logged full-year revenue guidance slightly missing analysts’ expectations.
eBay had the weakest full-year guidance update among its peers. The company reported 133 million active buyers, up 0.8% year on year. The stock is up 11.6% since reporting and currently trades at $69.90.
Read our full, actionable report on eBay here, it’s free.
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