10Y annualized return is
very good
at 14.7% per year
CSGP has met or exceeded earnings expectations in
most
recent quarters (9/10)
High Gross Profit Margin
Positive Net Profit Margin
Strong Liquidity Position
Minimal Debt Levels
Consistent Revenue Growth
High Profit Margins
Strong Customer Retention
Significant Expansion Plans
Innovative Product Development
Market Recovery Potential
Extremely High P/E Ratio
Negative Price to Free Cash Flow Ratio
Negative Operating Profit Margin
Low Return on Equity
Interest Coverage Ratio of Zero
Negative Free Cash Flow
Challenging Market Conditions
Moderating Growth Expectations
Overall, CoStar Group exhibits strong business quality through consistent revenue growth, high profit margins, and strong customer retention. However, it faces challenges from market conditions and moderating growth expectations in some segments. Looking forward, the company's plans for expansion and innovation present promising future prospects, while caution remains due to potential market headwinds.
Analysis Date: February 18, 2025
Last Updated: March 11, 2025
Past performance does not guarantee future results. The data presented is indicative and may not be updated in real-time.
CoStar Group, Inc. is a company that helps people in the real estate industry by providing useful information and tools. They offer services that allow businesses to find and analyze properties, track market trends, and understand tenant needs. Their platforms include websites for renting apartments and buying land or businesses. Overall, CoStar makes it easier for real estate professionals to make informed decisions.
Streams of revenue
Geographic Distribution
Core Products
Business Type
Business to Business
Competitive Advantages
Key Business Risks
Latest News
ARLINGTON, Va.--(BUSINESS WIRE)--Visual Lease, a CoStar Group (NASDAQ: CSGP) brand and a premier platform for integrated lease management, accounting,...
This story originally appeared on Real Estate News.
Third Point and D.E. Shaw are like-minded investors obtaining separate agreements with CoStar.
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
Benjamin Graham's value investing approach focuses on finding stocks with a significant margin of safety between their intrinsic value and market price.
Intrinsic Value
Estimated fair value based on Graham's formula
$4.26
Current Market Price: $75.27
IV/P Ratio: 0.06x (>1.0 indicates undervalued)
Margin of Safety
Gap between intrinsic value and market price
-1667.0000000000002%
Graham recommended a minimum of 20-30% margin of safety
Higher values indicate a greater potential discount to fair value
Graham Criteria Checklist
Benjamin Graham's value investing checklist for CSGP
Positive earnings (5+ years)
Dividend history (5+ years)
P/E ratio ≤ 20 (213.04)
P/B ratio ≤ 1.5 (3.91)
Current ratio ≥ 2.0 (8.96x)
Long-term debt < Net current assets (0.03x)
Margin of safety (-1667.0000000000002%)
CSGP does not meet all Graham criteria
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
Profitability metrics measure a company's ability to generate earnings relative to its revenue, operating costs, and other relevant metrics. Higher values generally indicate better performance.
Return on Equity (ROE)
Measures how efficiently a company uses its equity to generate profits
1.51%
Higher values indicate better returns for shareholders
TTM (as of 2025-04-30)
Gross Profit Margin
Percentage of revenue retained after accounting for cost of goods sold
78.49%
Higher values indicate better efficiency in production
TTM (as of 2025-04-30)
Net Profit Margin
Percentage of revenue retained after accounting for all expenses
5.07%
Higher values indicate better overall profitability
TTM (as of 2025-04-30)
Despite some challenges, CSGP maintains a net profit margin of 5.07%, indicating that it is able to convert a portion of its revenues into profit.
The operating profit margin is slightly negative at -0.15%, suggesting that CSGP is struggling to maintain profitability in its core operations.
The return on equity is low at 1.86%, which reflects a weak ability to generate returns from shareholders' equity.
Financial health metrics assess a company's ability to meet its financial obligations and its overall financial stability.
Debt to Equity Ratio
Total debt divided by total equity
0.02x
Lower values indicate less financial leverage and risk
Less than 1.0 is conservative, 1.0-2.0 is moderate, >2.0 indicates high risk
Q4 2024
Current Ratio
Current assets divided by current liabilities
8.96x
Higher values indicate better short-term liquidity
Less than 1.0 is concerning, 1.0-2.0 is adequate, greater than 2.0 is good
Q4 2024
CSGP has a current ratio of 8.96, indicating a very strong liquidity position and ability to cover short-term liabilities.
The debt-to-equity ratio is extremely low at 0.02, suggesting that the company has very little debt relative to its equity, which enhances its financial stability.
An interest coverage ratio of 0 indicates that the company is not generating enough earnings to cover interest expenses, raising concerns about financial sustainability.
The free cash flow per share is negative at -0.61, indicating cash outflows exceed cash inflows, which can impact growth and operations.
Meeting Expectations
Higher values indicate better execution and credibility
Recent Results
EPS
Revenue
CoStar Group has demonstrated strong financial performance, achieving 11% revenue growth year-over-year for 2024. The company has maintained 55 consecutive quarters of double-digit revenue growth, indicating a robust business model.
The commercial information and marketplace businesses achieved a profit margin of 43% in 2024. This high margin reflects the strength of the company's core product offerings and operational efficiency.
CoStar has an impressive renewal rate of 92% for its subscribers, indicating strong customer loyalty and satisfaction. This is further supported by high Net Promoter Scores (NPS), which reflect customer satisfaction.
The company has faced headwinds in the commercial real estate market, which have impacted performance and led to cautious growth expectations.
CoStar plans to grow its sales force significantly, particularly for Homes.com, indicating a strong commitment to capturing market share in the residential real estate sector. This expansion is expected to drive future revenue growth.
CoStar's focus on integrating new features and services, such as the CoStar Real Estate Manager and the recently launched Homes.com, showcases its commitment to innovation and improving customer offerings.
The CEO expressed optimism about a potential recovery in the commercial real estate market, which could create favorable conditions for growth and enhance CoStar's performance in the coming years.
While the company has ambitious plans, growth rates for some segments are expected to moderate, with guidance indicating lower growth for Apartments.com and LoopNet in 2025 compared to 2024.
Insider trading data shows purchase and sale activities by company executives and board members.
Insider trading patterns can provide insights into how company executives and board members view the stock's future prospects.
Insiders are buying significantly more than selling (ratio: 3.39x)
Total Bought
Total value of insider purchases in recent quarters
$1219159
Higher values indicate stronger insider confidence
Total Sold
Total value of insider sales in recent quarters
$359187
Lower values relative to buying indicate possible undervaluation
Active Insiders
Number of insiders trading in recent quarters
18
High insider activity
Recent Trend
Change in insider trading pattern
CSGP: No trend data available