CoStar Group, Inc. (CSGP)
OvervaluedFundamental
44
Price
$27.40
Market Cap
$11.29B
Part 1 · What the company is worth
Overview
CoStar Group builds and sells databases of commercial and residential real estate listings, prices and property information that brokers, landlords, lenders and investors pay to access. Its main products are subscription research and analytics tools for commercial real estate professionals, marketplaces such as LoopNet where landlords and agents list space for lease or sale, and the newer Homes.com and Apartments.com consumer sites, which compete for home shoppers' attention against Zillow.
How it makes money
Most revenue comes from recurring subscriptions that commercial real estate professionals renew year after year to keep access to CoStar's data, which makes that part of the business predictable and high-margin. Homes.com and Apartments.com instead earn money mainly from advertising paid by agents and landlords wanting more visibility, a newer and more competitive model that CoStar has been spending heavily to build into a leading consumer destination for home shoppers.
Revenue by segment
Advertising-funded marketplaces for apartment rentals and home sales, including the newer Homes.com consumer-facing search platform.
Subscription research and analytics on commercial real estate, the company's original and most profitable product line.
Online marketplace listing commercial properties for sale or lease, monetized largely through advertising from brokers and owners.
Smaller commercial real estate products including Ten-X property auctions, Matterport 3D tours and the BizBuySell business marketplace.
Competitive moat
Switching costs · WideCoStar built its commercial real estate database over decades by sending researchers to physically verify property data, which is expensive and slow for a rival to replicate, and brokers who rely on it daily are reluctant to give up a tool their workflow is built around. That advantage is strongest in CoStar Suite; it does not yet extend to Homes.com, which is still fighting an established leader.
What drives demand
Moderately cyclicalSubscription revenue from commercial real estate professionals is fairly sticky and holds up reasonably well through the cycle, since brokers need data whether the market is up or down. Advertising-funded residential revenue is more exposed to the health of the housing market and to how much agents and landlords are willing to spend to attract renters and buyers.
Key risks
- Homes.com investment losses — CoStar has been spending heavily to build Homes.com into a leading consumer destination, and management has indicated the business may not reach positive profitability for several more years.
- Competition from Zillow and Google — Homes.com and Apartments.com compete against Zillow and potentially Google for consumer attention, and restricted or more expensive access to listing data could raise CoStar's customer acquisition costs.
- Acquisition integration — CoStar has grown partly through a series of acquisitions, including Matterport and Domain, and integrating each new business carries execution risk and can strain management attention.
- Real estate market cyclicality — A slowdown in commercial or residential real estate activity would reduce the transaction volumes and advertising spend that support parts of CoStar's revenue.
The case for
Buyers argue that CoStar Suite and LoopNet remain a durable, high-margin data franchise that funds the company's push into residential, and that if Homes.com even partly closes the gap with Zillow, the payoff from a business already generating strong commercial cash flow could be large.
The case against
Sellers worry that Homes.com is burning cash against an entrenched leader with no clear timeline to profitability, and that continued heavy spending there could keep consuming the profits generated by the commercial business for years without a guaranteed payoff.
Written by the editors, published on August 18, 2026
Direct competitors
Who this company fights with for the same customers
Generated on September 18, 2026 with claude-haiku-4-5 — shared with all users
Zillow's home-search and rentals portals compete head-on with CoStar's Homes.com and Apartments.com for the same US agent advertising budgets and property-manager listing fees.
Through Moody's Analytics CRE and the Reis database, it sells commercial property comparables, valuations and market forecasts to the brokers, lenders and appraisers who subscribe to CoStar Suite.
Its Real Capital Analytics transaction database and real assets indexes compete for the institutional investors and lenders who pay CoStar for commercial property analytics.
Realtor.com, the News Corp-owned portal, sells the same lead and listing-promotion subscriptions to US residential agents that CoStar is trying to win with Homes.com.
Yardi's RentCafe marketplace and Yardi Matrix research service compete for the same multifamily owners and property managers that buy Apartments.com advertising and CoStar market data.
Crexi runs a commercial property listing marketplace with paid data and intelligence tiers aimed at the same brokers CoStar serves with LoopNet and CoStar Suite.
Balance Sheet & Liquidity
Revenue
$3.56B
Trailing 12 months (through 6/30/2026)
Net Income
$74M
Trailing 12 months (through 6/30/2026)
Free Cash Flow
$123M
Total Equity
$8.33B
Total Liabilities
$2.17B
Current Ratio
2.21
Interest Coverage
3.21
Debt/EBITDA
6.05
Earnings Per Share
Revenue & Net Income
Free Cash Flow
Income Breakdown
Historical statement
Margins over time
Debt over time
How heavy the debt is
Growth grid
Growth — Revenue
Fair Value Estimation
Fair Value
$18.12
Current Price
$27.40
Margin of Safety
-51.2%
Fair Value Range
$11.78 - $24.46
Spread across the valuation methods used, not a statistically calibrated confidence interval.
Estimation Methods
Valuation Metrics
P/E Ratio
137.00
ROE
0.1%
P/B Ratio
1.40
P/FCF
39.65
Gross Margin
78.7%
ROIC
0.7%
Profitability Radar
Value Creation (Economic Moat)
ROIC
0.7%
WACC
8.2%
ROIC − WACC
-7.6 pp
ROIC is below the cost of capital — the company is destroying value for every dollar invested.
Fundamental Analysis Criteria
Passed (12)
- Gross Margin 78.7%
- P/B Ratio 1.40
- Debt/Equity ratio
- Positive Free Cash Flow
- Current Ratio
- Interest Coverage
- Revenue Growth 5Y 14.4%
- Analyst Consensus 57% Buy
- Earnings Surprise avg 16.5%
- Earnings Quality (OCF/NI) 6.72
- Share Dilution -14.4%
- Piotroski F-Score 5/9
Failed (14)
- EPS shows upward trend
- EPS CAGR -21.39%
- Price CAGR 4.13%
- ROIC 0.6%
- P/FCF 39.65
- Operating Margin 2.2%
- CapEx intensity
- Debt/EBITDA
- Return on Tangible Assets
- Low reliance on intangibles
- Price below Graham Number
- DCF valuation (Overvalued)
- ROE 0.9%
- Net Margin Trend 2.1% vs 3.6%
Unavailable (2)
- Dividend Payout NaN%
- PEG Ratio (need PE > 0 and growth > 0)
Piotroski F-Score
Mixed signals: some areas need attention
Earnings Quality
High quality: earnings backed by cash
Share Dilution
Buying back shares. Shareholder friendly
Institutional Holdings
Governance
Executive Team
| Name | Title | Age |
|---|---|---|
| Mr. Andrew C. Florance | President, Founder, CEO & Director | 61 |
| Ms. Lisa C. Ruggles | Senior Vice President of Global Operations | 58 |
| Mr. Frank A. Simuro | Chief Technology Officer | 58 |
| Mr. Frederick G. Saint | President of Marketplaces | 59 |
| Mr. Robin Rossmann | Chief Financial Officer | 44 |
| Ms. Cyndi Eakin | CAO & Cotroller | - |
| Mr. Jason Butler | Chief Information Officer | - |
| Mr. Richard Simonelli | Head of Investor Relations | - |
| Mr. Gene Boxer | General Counsel & Corporate Secretary | 50 |
| Mr. Matthew R. Blocher | Vice President of Marketing & Communications | - |
Audit Risk
2
Board Risk
1
Compensation Risk
9
Shareholder Rights Risk
4
Part 2 · The price and when to enter
This part won't tell you whether the company is worth owning: it helps you choose when to buy it, once the fundamentals have convinced you. Inside: technical analysis, potential, historical drawdowns, gamma exposure.
Documents
- View document
Annual Report (10-K)
A yearly overview of the business, its financial results, and the risks it faces.
Filed on 2026-02-26
- View document
Quarterly Report (10-Q)
A snapshot of financial performance for the most recent three-month period.
Filed on 2026-07-29
- View document
Current Report (8-K)
An announcement of a major event, such as a leadership change or big news.
Filed on 2026-08-21
via SEC EDGAR
Income History
via SEC EDGAR
Latest News
Recent headlines for CSGP, sourced from Markets Gazette.