CoStar Group, Inc. provides information, analytics, and online marketplace services to the commercial real estate, hospitality, residential, and related professionals industries in the United States, Canada, Europe, the Asia Pacific, and Latin America.
CoStar Group Competitors
Price History & Performance
|Historical stock prices|
|Current Share Price||US$89.38|
|52 Week High||US$74.31|
|52 Week Low||US$95.28|
|1 Month Change||8.79%|
|3 Month Change||1.69%|
|1 Year Change||8.01%|
|3 Year Change||112.99%|
|5 Year Change||310.00%|
|Change since IPO||9,627.91%|
Recent News & Updates
Is CoStar Group, Inc. (NASDAQ:CSGP) Potentially Undervalued?
Let's talk about the popular CoStar Group, Inc. ( NASDAQ:CSGP ). The company's shares saw significant share price...
CoStar Group: Growing Free Cash Flow, And Undervalued
CoStar Group offers real estate information and online marketplaces in the United States. CoStar Group, Inc. owns a database developed for more than 30 years. It means that the company has information about many clients and real estate assets. I used conservative assumptions and a DCF model with two case scenarios. They revealed that CoStar’s fair price is somewhere between $88 and $126, which is above the current market. Assuming a share price of $86, a beta of 0.8, a cost of debt of 5%, and a risk-free rate of 2.4%, I obtained a WACC of 7%. I also assumed 2022 sales of $2.93 billion, 2024 sales of $3.54 billion, and 2025 sales of $4.2 billion. Since the interest rates are quite small, most financial models will depend a lot on the future free cash flow and the terminal free cash flow. In our case, we used a terminal 2026 free cash flow of $1.2 billion.
We Remain At Buy On CoStar Group
CoStar Group is a data business serving the commercial real estate industry. Despite its $31bn market cap it is not particularly well known outside of its immediate circle. The company's financial fundamentals are solid - sound levels of revenue growth, high margins and cash generation. The balance sheet is clean. The stock price however has been a little wild, following a period of uncertainty as to whether the company would acquire a large competitor. We think the stock can run up from here and rate the name at Buy.
|CSGP||US Professional Services||US Market|
Return vs Industry: CSGP underperformed the US Professional Services industry which returned 28.4% over the past year.
Return vs Market: CSGP underperformed the US Market which returned 33.8% over the past year.
Stable Share Price: CSGP is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 3% a week.
Volatility Over Time: CSGP's weekly volatility (3%) has been stable over the past year.
About the Company
CoStar Group, Inc. provides information, analytics, and online marketplace services to the commercial real estate, hospitality, residential, and related professionals industries in the United States, Canada, Europe, the Asia Pacific, and Latin America. It offers CoStar Property Professional that provides inventory of office, industrial, retail, and multifamily, and student housing properties and land; CoStar COMPS Professional, which covers comparable commercial real estate sales information; CoStar Market Analytics to view and report on aggregated market and submarket trends; and CoStar Tenant, an online business-to-business prospecting and analytical tool that provides tenant information. The company also provides CoStar Lease Comps, a tool to capture, manage, and maintain lease data; CoStar Lease Analysis, a workflow tool; CoStar Public Record, a searchable database of commercially-zoned parcels; CoStar Real Estate Manager, a real estate and asset management, and lease accounting software; and CoStar Risk Analytics and CoStar Investment Analysis that provides market research, consulting and analysis, portfolio and debt analysis, and management and reporting services, as well as STAR Report that offers benchmarking and analytics services.
CoStar Group Fundamentals Summary
|CSGP fundamental statistics|
Is CSGP overvalued?See Fair Value and valuation analysis
Earnings & Revenue
|CSGP income statement (TTM)|
|Cost of Revenue||US$334.33m|
Last Reported Earnings
Jun 30, 2021
Next Earnings Date
Oct 26, 2021
|Earnings per share (EPS)||0.59|
|Net Profit Margin||12.68%|
How did CSGP perform over the long term?See historical performance and comparison
Is CoStar Group undervalued compared to its fair value and its price relative to the market?
Price to Earnings (PE) ratio
Share Price vs. Fair Value
Below Fair Value: CSGP ($89.38) is trading above our estimate of fair value ($74.84)
Significantly Below Fair Value: CSGP is trading above our estimate of fair value.
Price To Earnings Ratio
PE vs Industry: CSGP is poor value based on its PE Ratio (153.9x) compared to the US Professional Services industry average (25.3x).
PE vs Market: CSGP is poor value based on its PE Ratio (153.9x) compared to the US market (17.8x).
Price to Earnings Growth Ratio
PEG Ratio: CSGP is poor value based on its PEG Ratio (5.1x)
Price to Book Ratio
PB vs Industry: CSGP is overvalued based on its PB Ratio (6.4x) compared to the US Professional Services industry average (3.1x).
How is CoStar Group forecast to perform in the next 1 to 3 years based on estimates from 13 analysts?
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: CSGP's forecast earnings growth (30.1% per year) is above the savings rate (2%).
Earnings vs Market: CSGP's earnings (30.1% per year) are forecast to grow faster than the US market (14.9% per year).
High Growth Earnings: earnings are expected to grow significantly over the next 3 years.
Revenue vs Market: CSGP's revenue (15.1% per year) is forecast to grow faster than the US market (9.8% per year).
High Growth Revenue: CSGP's revenue (15.1% per year) is forecast to grow slower than 20% per year.
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: CSGP's Return on Equity is forecast to be low in 3 years time (10.9%).
How has CoStar Group performed over the past 5 years?
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: CSGP has high quality earnings.
Growing Profit Margin: CSGP's current net profit margins (12.7%) are lower than last year (19.8%).
Past Earnings Growth Analysis
Earnings Trend: CSGP's earnings have grown significantly by 24.5% per year over the past 5 years.
Accelerating Growth: CSGP's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.
Earnings vs Industry: CSGP had negative earnings growth (-23.5%) over the past year, making it difficult to compare to the Professional Services industry average (19%).
Return on Equity
High ROE: CSGP's Return on Equity (4.1%) is considered low.
How is CoStar Group's financial position?
Financial Position Analysis
Short Term Liabilities: CSGP's short term assets ($3.8B) exceed its short term liabilities ($328.7M).
Long Term Liabilities: CSGP's short term assets ($3.8B) exceed its long term liabilities ($1.2B).
Debt to Equity History and Analysis
Debt Level: CSGP's debt to equity ratio (17.9%) is considered satisfactory.
Reducing Debt: CSGP's debt to equity ratio has reduced from 21.2% to 17.9% over the past 5 years.
Debt Coverage: CSGP's debt is well covered by operating cash flow (46.4%).
Interest Coverage: CSGP's interest payments on its debt are well covered by EBIT (10.7x coverage).
What is CoStar Group current dividend yield, its reliability and sustainability?
Dividend Yield vs Market
Notable Dividend: Unable to evaluate CSGP's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.
High Dividend: Unable to evaluate CSGP's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.
Stability and Growth of Payments
Stable Dividend: Insufficient data to determine if CSGP's dividends per share have been stable in the past.
Growing Dividend: Insufficient data to determine if CSGP's dividend payments have been increasing.
Current Payout to Shareholders
Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.
Future Payout to Shareholders
Future Dividend Coverage: No need to calculate the sustainability of CSGP's dividend in 3 years as they are not forecast to pay a notable one for the US market.
How experienced are the management team and are they aligned to shareholders interests?
Average management tenure
Andy Florance (57 yo)
Mr. Andrew C. Florance, also known as Andy, founded CoStar Group, Inc. in 1987. Mr. Florance serves as the Chief Executive Officer, President and Director at CoStar Group, Inc. He is a frequent speaker on...
CEO Compensation Analysis
Compensation vs Market: Andy's total compensation ($USD21.30M) is above average for companies of similar size in the US market ($USD11.36M).
Compensation vs Earnings: Andy's compensation has been consistent with company performance over the past year.
Experienced Management: CSGP's management team is considered experienced (2.7 years average tenure).
Experienced Board: CSGP's board of directors are seasoned and experienced ( 11.1 years average tenure).
Who are the major shareholders and have insiders been buying or selling?
Insider Trading Volume
Insider Buying: CSGP insiders have only sold shares in the past 3 months.
Recent Insider Transactions
Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.
CoStar Group, Inc.'s employee growth, exchange listings and data sources
- Name: CoStar Group, Inc.
- Ticker: CSGP
- Exchange: NasdaqGS
- Founded: 1987
- Industry: Research and Consulting Services
- Sector: Commercial Services
- Market Cap: US$35.301b
- Shares outstanding: 394.96m
- Website: https://www.costargroup.com
Number of Employees
- CoStar Group, Inc.
- 1331 L Street, NW
- District Of Columbia
- United States
Company Analysis and Financial Data Status
|Data||Last Updated (UTC time)|
|Company Analysis||2021/09/18 22:02|
|End of Day Share Price||2021/09/17 00:00|
Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.