CoStar Group (CSGP) AI Stock Analysis

• Market Cap: $19.64B
• Dividend Yield: N/A
• Average Volume (3M): 7.23M
• Price to Earnings (P/E): 4003.7
• Beta (1Y): 0.86
• Revenue Growth: 14.61%
• EPS Growth: -87.93%
• Country: US
• Employees: 6,593
• Sector: Real Estate
• Sector Strength: 53
• Industry: Real Estate - Services
• EPS (TTM): 0.31
• Shares Outstanding: 419,793,300
• 10 Day Avg. Volume: 7,317,347
• 30 Day Avg. Volume: 7,234,362
• PEG Ratio: -42.12
• Price to Book (P/B): 3.36
• Price to Sales (P/S): 8.63
• P/FCF Ratio: 683.55
• Enterprise Value/Market Cap: 1.03
• Enterprise Value/Revenue: 6.20
• Enterprise Value/Gross Profit: 8.00
• Enterprise Value/Ebitda: 94.47
• 1Y Price Target: $63.53
• Price Target Upside: 33.47% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 16
• EPS Forecast (FY): 1.3
• Revenue Forecast (FY): $3.81B

• Rating: 54 Neutral
• Price Target: $46.00 ▼(-3.36% Downside)
• Action: Reiterated Date: 02/26/26
• Date: Action: Reiterated 02/26/26

The score is held back primarily by weak technicals (broad downtrend) and an extremely expensive valuation. Financial performance is mixed—good top-line growth and a strong balance sheet, but profitability and free cash flow weakened materially. The latest earnings call and recent buyback/comp changes are supportive, but not enough to offset trend, valuation, and near-term margin/cash-flow pressure.

Positive Factors

Recurring subscription & marketplace revenue

CoStar’s core model is recurring subscription fees plus marketplace listing/advertising, creating predictable revenue streams and high customer retention. Over a multi-quarter horizon this supports predictable top-line growth, pricing power, and ability to cross-sell analytics across large, engaged client bases.

Scale and market leadership across platforms

Leading positions in commercial info (CoStar Suite, LoopNet) and residential portals (Apartments.com) produce data network effects, breadth of inventory, and brand advantages. Scale enables richer datasets, higher switching costs for customers, and durable competitive moats that sustain margins and cross-selling opportunities.

Conservative balance sheet and capital flexibility

Low leverage and rising equity provide financial flexibility to fund product investment, M&A, or buybacks without forcing deleveraging. Combined with an active repurchase program and capital-allocation review, the strong balance sheet supports strategic optionality and resilience across economic cycles.

Negative Factors

Profitability deterioration

A structural decline to negative operating profit weakens CoStar’s ability to compound returns and deleverages the business model. If higher operating costs or investments persist, margin recovery must occur to restore long-term ROE, limit dilution from financing, and sustain reinvestment capacity.

Weak and volatile free cash flow

Deteriorating and inconsistent free cash flow undermines internal funding for growth, share repurchases, and debt reduction. Over several quarters this constrains capital allocation choices, increases reliance on external financing for major initiatives, and reduces margin of safety during cyclical downturns.

High-risk Homes.com investment and activist governance risk

Large ongoing spend into Homes.com and related strategic disagreements have attracted activist pressure, signaling governance and execution risk. Prolonged heavy investment with unclear near-term returns can divert management focus, strain cash, and create the potential for disruptive strategic or leadership changes.

CoStar Group Business Overview & Revenue Model

Company Description

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 that provides inventory of office, industrial, retail, multifamily, hospitality, and student housing properties and land; CoStar COMPS, a robust database of comparable commercial real estate sales transactions; 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 Lease Comps and Analysis, a tool to capture, manage, and maintain lease data; CoStar Lease Analysis; Public Record, a searchable database of commercially-zoned parcels; CoStar Real Estate Manager, a real estate lease administration, portfolio management, and lease accounting compliance software solution; and CoStar Risk Analytics and CoStar Investment. In addition, it offers apartment marketing sites, such as ApartmentFinder.com, ForRent.com, ApartmentHomeLiving.com, WestsideRentals.com, AFTER55.com, CorporateHousing.com, ForRentUniversity.com, Apartamentos.com, and Off Campus Partners; LoopNet Premium Lister; LoopNet Diamond, Platinum, and Gold Ads; LandsofAmerica.com, LandAndFarm.com, and LandWatch.com for rural land for-sale; BizBuySell.com, BizQuest.com, and FindaFranchise.com for operating businesses and franchises for-sale; Ten-X, an online auction platform for commercial real estate; and HomeSnap, an online and mobile software platform, as well as Homes.com, a homes for sale listings site. CoStar Group, Inc. was founded in 1987 and is headquartered in Washington, the District of Columbia.

How the Company Makes Money

CoStar Group generates revenue through several key streams, primarily from subscription-based services that provide access to its extensive databases and analytical tools. Subscribers pay recurring fees for access to the CoStar Suite, which offers detailed property information and market analytics. Additionally, CoStar earns revenue from transaction-based services, including listing fees and advertising on platforms like LoopNet and Apartments.com, where users can list properties for sale or lease. The company also benefits from long-term contracts with large clients, which provide a stable revenue base. Strategic partnerships with various real estate firms and industry organizations further enhance its market reach and revenue potential, allowing CoStar to maintain a strong competitive advantage in the commercial real estate sector.

CoStar Group Financial Statement Overview

Summary

Strong revenue growth and a conservative, low-leverage balance sheet are positives, but 2025 saw a sharp profitability reset (operating profit turning negative) and materially weaker/free cash flow versus prior years, lowering overall quality.

Income Statement

Revenue growth has been solid over the period, with 2025 annual revenue up meaningfully versus 2024. However, profitability has deteriorated sharply: operating profit turned negative in 2025 (down from modestly positive in 2024 and strong levels in 2022–2023), and net income fell to near break-even in 2025 after healthy profits in prior years. Gross margin remains high, but the step-down in operating and net margins points to elevated operating costs and weaker earnings quality in the most recent year.

Balance Sheet

The balance sheet looks conservative with low leverage: debt-to-equity is consistently low and improved further by 2025, while equity has grown over time. Total assets and equity both trend upward, providing financial flexibility. The main weakness is that returns on equity were modest in the years provided and profitability weakened materially in 2025, which can limit the balance sheet’s ability to compound value if earnings do not recover.

Cash Flow

Operating cash flow remains positive and relatively stable, but free cash flow has become volatile and weak recently. After strong free cash flow in 2020–2023, 2024 turned negative and 2025 remained positive but far below historical levels, reflected in a very large year-over-year decline in 2025. Cash generation versus earnings also looks less supportive lately, with operating cash flow not fully covering net income in 2024–2025 and free cash flow only a small fraction of net income in 2025.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	3.25B	2.74B	2.46B	2.18B	1.94B
Gross Profit	2.44B	2.18B	1.96B	1.77B	1.59B
EBITDA	272.00M	151.60M	389.80M	588.90M	571.86M
Net Income	7.00M	138.70M	374.70M	369.50M	292.60M
Balance Sheet
Total Assets	10.54B	9.26B	8.92B	8.40B	7.26B
Cash, Cash Equivalents and Short-Term Investments	1.73B	4.68B	5.22B	4.97B	3.83B
Total Debt	1.02B	1.04B	1.11B	1.11B	1.11B
Total Liabilities	2.17B	1.70B	1.58B	1.53B	1.55B
Stockholders Equity	8.33B	7.55B	7.34B	6.87B	5.71B
Cash Flow
Free Cash Flow	41.00M	-245.30M	464.20M	420.05M	404.51M
Operating Cash Flow	430.00M	392.60M	489.50M	478.62M	469.73M
Investing Cash Flow	-2.82B	-912.90M	-238.60M	-69.10M	-381.34M
Financing Cash Flow	-559.00M	-13.70M	-3.70M	733.98M	-15.68M

CoStar Group Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 47.60
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CSGP, the sentiment is Negative. The current price of 47.6 is below the 20-day moving average (MA) of 47.90, below the 50-day MA of 57.63, and below the 200-day MA of 74.39, indicating a bearish trend. The MACD of -3.40 indicates Negative momentum. The RSI at 40.54 is Neutral, neither overbought nor oversold. The STOCH value of 37.63 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CSGP.

CoStar Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
JLL	70 Outperform	$14.57B	20.11	11.10%	―	12.51%	32.34%
CBRE	68 Neutral	$42.10B	41.44	13.38%	―	14.61%	30.19%
Sector *	65 Neutral	$2.17B	12.19	3.79%	4.94%	3.15%	1.96%
BEKE	62 Neutral	$19.07B	49.85	4.91%	2.26%	25.33%	-15.12%
CWK	60 Neutral	$3.10B	42.44	12.21%	―	6.77%	150.72%
NMRK	56 Neutral	$2.64B	24.52	9.37%	0.68%	22.22%	94.52%
CSGP	54 Neutral	$19.64B	4,003.66	0.09%	―	14.61%	-87.93%

CoStar Group Corporate Events

CoStar Expands Use of Website for Investor Disclosures

CoStar Group announced that it plans to use its corporate website as a primary channel for distributing material company information, including investor presentations. The company noted that while these materials will be available online for stakeholders, the information posted on its website will not be incorporated by reference into its SEC filings or other official reports.

This approach underscores a broader reliance on digital channels for investor communication, potentially improving accessibility and timeliness of information for shareholders and analysts. At the same time, CoStar is clearly delineating the legal status of website content to maintain a separation between informal disclosures and formal regulatory documents filed with the SEC.

The most recent analyst rating on (CSGP) stock is a Buy with a $67.00 price target. To see the full list of analyst forecasts on CoStar Group stock, see the CSGP Stock Forecast page.

CoStar Amends Executive Severance Plan Amid Activist Pressure

On February 13, 2026, CoStar Group amended its Executive Severance Plan to delete a board-composition-based clause from the definition of “change in control,” while leaving all other provisions intact. The removed director clause, previously developed with independent advisors to support management continuity and aligned with peer practices, was dropped at management’s request to avoid the cost and distraction of litigation in Delaware tied to threatened proxy contests by activist investors Third Point LLC and D. E. Shaw & Co., L.P., signaling the company’s effort to reduce governance-related friction with shareholders while preserving its broader severance framework.

The most recent analyst rating on (CSGP) stock is a Hold with a $53.00 price target. To see the full list of analyst forecasts on CoStar Group stock, see the CSGP Stock Forecast page.

CoStar Group Updates Executive Pay, Launches Share Buyback

On January 7, 2026, CoStar Realty Information, Inc., a subsidiary of CoStar Group, amended the employment agreement of founder and CEO Andrew C. Florance, effective January 1, 2026, to remove a long-standing tax gross-up provision related to Sections 280G and 4999 of the Internal Revenue Code, and simultaneously adopted an Executive Severance Plan that standardizes severance benefits, including salary-based payouts, bonus entitlements, subsidized COBRA coverage, and equity vesting acceleration for vice president-level executives and above in the event of involuntary termination, subject to release of claims. On the same date, the company also issued a press release outlining its full-year 2026 financial outlook and medium-term and long-term targets for its Homes.com investment, while unveiling a new $1.5 billion share repurchase program and revising its executive compensation framework in response to shareholder feedback, signaling a broader effort to align leadership incentives with investor interests and enhance capital return to shareholders.

The most recent analyst rating on (CSGP) stock is a Hold with a $70.00 price target. To see the full list of analyst forecasts on CoStar Group stock, see the CSGP Stock Forecast page.