COSTAR GROUP, INC. (CSGP)

Price—Loading quote

AI: Overvalued

Price checkThe shares look expensive because the price already assumes a major profit recovery.

Boursorama records a $32.38 August 14 close, implying a $13.12 billion market value using roughly 405 million shares. Enterprise value—the stock value plus debt minus cash—is about $12.85 billion, or 16.1 times the midpoint of 2026 adjusted operating-profit guidance. The price is also 23.9 times midpoint adjusted earnings of $1.355 per share. Inference: because those measures exclude substantial stock pay and acquisition-related costs while first-half free cash flow was only $155 million, the valuation offers little downside cushion.

Big pictureSales keep growing, but reliable cash earnings have not yet caught up.

Reported revenue rose from $1.66 billion in 2020 to $3.25 billion in 2025, yet operating income fell from $289 million to a $72 million loss. Operating cash flow remained positive at $430 million, but spending on property and equipment left only $123 million of free cash flow, meaning cash left after running and investing in the business. First-half 2026 free cash flow improved to $155 million. Subscriptions were 93% of 2025 revenue with 89% renewals, providing stability despite property-market cyclicality.

Business strengthA durable data franchise is offset by a much thinner cash cushion.

CoStar has spent more than 35 years building proprietary property databases, while 2025 gross profit equaled 79% of revenue. However, net cash fell from $3.69 billion at year-end 2024 to $272 million in June 2026 after acquisitions and repurchases. The pending $800 million Zonda purchase could create net debt before additional cash generation. First-half buybacks of $587 million reduced quarterly diluted shares from 424 million to 404 million, but shares had risen 6% from 2020 through 2025 and stock compensation totaled $80 million in first-half 2026.

What could change the storyFaster cash conversion could justify the price, while weaker growth would deepen downside.

The strongest bull case is delivery of $780 million to $820 million of 2026 adjusted operating profit, followed by management’s $1.25 billion target for 2028; residential operations turning profitable would support that path. The bear case is that slower property activity keeps sales below plan while acquisitions consume cash. Inference: today’s price requires sustained double-digit sales growth, rising reported profit and materially better free cash flow. Meeting guidance while maintaining renewal rates near 89% would help; single-digit growth or rising debt without matching Zonda profit would strengthen the overvaluation case.

$32.38 price considered

AI: News

Guidance cut despite recoverySecond-quarter profit improved sharply, but lower sales guidance exposed softer near-term demand.

On July 28, CoStar reported second-quarter revenue of $925 million, up 18%, and adjusted operating profit of $184 million, more than double the prior year. It nevertheless reduced 2026 revenue guidance from $3.78–$3.82 billion to $3.715–$3.755 billion while retaining profit guidance. Reuters reported an initial 14% premarket decline to $26.10 on July 29. The weaker sales outlook matters because the valuation depends on continued rapid growth, although the preserved profit forecast indicates cost reductions are partly offsetting demand softness.

Finance chief transitionThe finance chief changed as investors demanded clearer cost control and more disciplined spending.

CoStar announced on July 13 that Robin Rossmann would replace Christian Lown as finance chief effective July 31; the company said Lown’s departure involved no disagreement. On July 14, Baird downgraded the shares and cut its target from $48 to $34, citing the departure, lack of a simultaneous guidance reaffirmation and weak bookings. The stock closed July 14 down about 3.8%. That timing supports an association, not proof that the leadership change alone caused the decline. Rossmann previously reduced European costs by about $51 million.

Zonda deal expands reachCoStar agreed to spend $800 million on Zonda, expanding data reach but tightening liquidity.

On May 29, CoStar announced an agreement to acquire Zonda for $800 million in cash, subject to regulatory and other closing conditions. CoStar reported that Zonda serves more than 3,000 homebuilding customers, earns most revenue from subscriptions and has 104% net customer retention. The deal could add valuable construction data, software and cross-selling opportunities. However, the price exceeds CoStar’s $272 million June net-cash position, so financing and integration could reduce balance-sheet protection. No reliable immediate stock reaction was identified.

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Financial statements

	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015	2014	2013	2012	2011	2010	2009
Revenue	$3.25B	$2.74B	$2.46B	$2.18B	$1.94B	$1.66B	$1.40B	$1.19B	$965.2M	$837.6M	$711.8M	$575.9M	$440.9M	$349.9M	$251.7M	$226.3M	$209.7M
Gross profit	$2.56B	$2.18B	$1.96B	$1.77B	$1.59B	$1.35B	$1.11B	$921.9M	$744.8M	$663.8M	$522.9M	$419.0M	$311.8M	$235.1M	$163.6M	$142.7M	$135.9M
Operating expenses	$2.63B	$2.17B	$1.68B	$1.32B	$1.15B	$1.06B	$746.9M	$648.3M	$571.0M	$518.9M	$511.4M	$338.1M	$257.6M	$207.6M	$141.8M	$119.9M	$104.1M
Operating income	−$72.0M	$5.0M	$282.0M	$451.0M	$432.3M	$289.2M	$363.5M	$273.6M	$173.8M	$144.9M	$11.5M	$80.9M	$54.2M	$27.4M	$21.8M	$22.8M	$31.8M
EBITDAderived	$191.0M	$152.0M	$390.0M	$588.9M	$571.9M	$406.1M	$444.7M	$351.3M	$237.5M	$215.1M	$90.0M	$151.3M	$67.1M	$38.0M	$31.0M	$32.6M	$42.8M
Net income	$7.0M	$139.0M	$375.0M	$369.5M	$292.6M	$227.1M	$315.0M	$238.3M	$122.7M	$85.1M	−$3.5M	$44.9M	$29.7M	$9.9M	$14.7M	$13.3M	$18.7M
Basic EPSper diluted share	$0.02	$0.34	$0.92	$0.93	$0.75	$0.60	$0.87	$6.61	$3.70	$2.64	-$0.11	$1.48	$1.07	$0.37	$0.63	$0.65	$0.95
Diluted EPSper diluted share	$0.02	$0.34	$0.92	$0.93	$0.74	$0.59	$0.86	$6.54	$3.66	$2.62	-$0.11	$1.46	$1.05	$0.37	$0.62	$0.64	$0.94

Review source filings at SEC.gov ↗

Insider buys & sells

Jul 1, 2024–Jun 30, 2026

Buys7$7.09M disclosed value

Sells (SEC code S)14$13.66M disclosed value

Transaction	Insider	Type	Shares	Price	Value	Owned after
May 1, 2026Form 4	FLORANCE ANDREW CPresident and CEO	BuyCommon Stock, par value $0.01 per share	3.1K	$35.82	$111.0K	1.72M
May 1, 2026Form 4	FLORANCE ANDREW CPresident and CEO	BuyCommon Stock, par value $0.01 per share	68.3K	$35.17	$2.40M	1.72M
Mar 6, 2026Form 4	Sams Louise SDirector	BuyCommon Stock, par value $0.01 per share	1.0K	$48.36	$48.4K	20.4K
Mar 2, 2026Form 4	SAINT FREDERICK G.President, Marketplaces	BuyCommon Stock, par value $0.01 per share	20.0K	$45.33	$906.6K	279.9K
Mar 2, 2026Form 4	Glaser Rachel CDirector	BuyCommon Stock, par value $0.01 per share	1.0K	$44.94	$44.9K	4.2K

Review ownership filings at SEC.gov ↗

COSTAR GROUP, INC. (CSGP)

Financial charts

Financial statements

Insider buys & sells