Analyzing CSGP Stock Performance – A Market Overview

Now trading at a price of $94.75, CoStar has moved 3.2% so far today.

CoStar returned gains of 37.7% last year, with its stock price reaching a high of $100.38 and a low of $67.22. Over the same period, the stock outperformed the S&P 500 index by 11.0%. More recently, the company's 50-day average price was $87.89. 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. Based in Washington, DC, the Large-Cap Finance company has 6,152 full time employees. CoStar has not offered a dividend during the last year.

Increasing Revenues but Narrowing Margins:

2018 2019 2020 2021 2022 2023
Revenue (M) $1,192 $1,400 $1,659 $1,944 $2,182 $2,455
Interest Income (M) $3 $3 -$17 -$32 $32 $214
Operating Margins 23% 26% 17% 22% 21% 11%
Net Margins 20% 23% 14% 15% 17% 15%
Net Income (M) $238 $315 $227 $293 $370 $375
Depreciation & Amort. (M) $78 $81 $117 $140 $138 $108
Diluted Shares (M) 364 366 383 394 398 407
Earnings Per Share $0.65 $0.86 $0.59 $0.74 $0.93 $0.92
EPS Growth n/a 32.31% -31.4% 25.42% 25.68% -1.08%
Avg. Price $38.09 $52.81 $74.41 $85.77 $63.41 $94.75
P/E Ratio 57.71 61.41 120.02 115.91 67.46 102.99
CAPEX (M) $30 $46 $48 $124 $35 $118
Current Ratio 7.87 5.79 11.75 11.78 13.91 12.01

CoStar has rapidly growing revenues and increasing reinvestment in the business, an excellent current ratio of 12.01, and positive EPS growth. However, the firm has weak operating margins with a negative growth trend.

CoStar's Valuation Is in Line With Its Sector Averages:

CoStar has a trailing twelve month P/E ratio of 95.5, compared to an average of 12.38 for the Finance sector. Based on its EPS guidance of $1.26, the company has a forward P/E ratio of 69.8. The 9.9% compound average growth rate of CoStar's historical and projected earnings per share yields a PEG ratio of 9.63. This suggests that these shares are overvalued. Furthermore, CoStar is likely overvalued compared to the book value of its equity, since its P/B ratio of 5.27 is higher than the sector average of 1.58. The company's shares are currently trading 390.4% below their Graham number.

CoStar Has an Analyst Consensus of Some Upside Potential:

The 11 analysts following CoStar have set target prices ranging from $79.0 to $111.0 per share, for an average of $99.45 with a buy rating. The company is trading -4.7% away from its average target price, indicating that there is an analyst consensus of some upside potential.

CoStar has a very low short interest because 1.8% of the company's shares are sold short. Institutions own 100.8% of the company's shares, and the insider ownership rate stands at 1.19%, suggesting a large amount of insider shareholders. The largest shareholder is Vanguard Group Inc, whose 16% stake in the company is worth $6,150,203,455.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.