CSGP changes
Pick any two versions below to diff them.
- Price
- $32.00 → $30.17(−5.7%)
- Next earnings
- Oct 27, 2026 → Jan 27, 2027
- Next earnings is estimate
- No → Yes
- About
- CoStar Group sells real estate information and runs online real estate marketplaces. It reports two segments. Commercial Real Estate includes the CoStar database and analytics, which brokers, owners and lenders buy by subscription, the LoopNet listing marketplace and other services such as Ten-X auctions; it had removed: $481 added: $492 million of revenue in removed: Q2 added: Q3 2026. Residential Real Estate includes Apartments.com, where landlords pay to list rentals, and Homes.com, where agents pay for advertising, with removed: $444 added: $460 million of revenue in removed: Q2 added: Q3 2026. In August 2026, CoStar bought Zonda, a new-home data and marketplace company, for $800 million in cash. added: In October 2026, it agreed to buy Vexcel, a provider of aerial imagery and geospatial data, for about $730 million in cash. Most revenue is recurring subscription and listing fees. For years, CoStar spent heavily on Homes.com marketing to win home search traffic, and in 2026 it cut this spending to raise profit.
- Thesis
- The market prices CoStar at a discount because it doubts that the large spending on Homes.com will pay off, and it fears that AI search can weaken listing marketplaces and data subscriptions. removed: Revenue added: Profit now grows fast, but sales growth removed: is slowing: in July added: slows. In Q3 2026, removed: CoStar cut its 2026 revenue outlook added: adjusted EBITDA doubled to removed: $3.715 billion to $3.755 billion from about $3.8 billion, added: $229 million, and added: the Residential segment had adjusted EBITDA of $49 million. But net new bookings removed: of $69 added: fell to $37 million removed: in Q2 were about 26% lower than added: from $84 million a year removed: earlier. The stock fell about 14% after that report, added: earlier, and removed: the CFO left at the end added: CoStar guides Q4 2026 revenue growth of removed: July 2026. Activist investors Third Point and D.E. Shaw pushed added: about 10%. CoStar also continues to buy companies: it paid $800 million for removed: changes at the board added: Zonda in August 2026 and removed: at Homes.com earlier added: agreed to buy Vexcel for about $730 million in added: October 2026. For the gap to close, removed: CoStar added: three things must removed: show that profit grows while revenue keeps growing at double digits. The checks are full-year adjusted EBITDA within the $780 million to $820 million outlook, a Residential segment that stays profitable after it turned positive in Q2 2026, net added: be true. Net new bookings removed: that added: must grow again, added: because lower bookings lead to slower revenue later. Costs must keep falling: CoStar expects at least $200 million of more savings over 12 to 18 months and added: keeps its 2028 adjusted EBITDA target of $1.25 billion. AI products such as Homes.com Ai and Apartments.com removed: Ai that added: Ai, and the new data from Zonda and Vexcel, must raise leads and keep customers. The removed: first test is the Q3 added: full-year 2026 report removed: on October 27, 2026, with guided revenue of $935 million to $945 million and removed: adjusted EBITDA of $190 million to $210 million. The full-year report and added: the 2027 outlook in removed: February added: early 2027 are the next test. If profit and bookings both improve, the gap can close slowly over 2027 and 2028. The main risk is that AI tools from large technology companies take traffic from Homes.com and Apartments.com.
- Risks
- AI search tools can change how people search for homes and rentals, and how brokers get data. If large AI platforms send traffic around Homes.com and Apartments.com, the value of paid listings falls. CoStar launched its own AI tools in 2026, and their effect on revenue is not proven yet. Revenue growth slows. removed: CoStar cut its 2026 revenue outlook in July 2026, and Q2 net added: Net new bookings removed: were about 26% lower than added: fell to $37 million in Q3 2026 from $84 million a year removed: earlier. Management said added: earlier, after $69 million in Q2 2026. Press reports of the removed: fall came from added: earnings call said that management named slower growth of its removed: own choices to improve efficiency, but lower added: sales force and the economy as causes. Lower bookings lead to slower revenue removed: later. added: later, and CoStar guides Q4 2026 revenue growth of about 10%. Homes.com competes with larger home search sites, and the Residential segment lost money until Q2 2026. If spending cuts weaken its traffic, the past investment loses value. If CoStar raises spending again, profit falls. Management changes. A new CFO started on July 31, 2026, a new President of Homes.com in September 2026, and activist investors pushed for board changes earlier in 2026. Changes in strategy can add cost and risk. added: CoStar spends large amounts of cash on acquisitions: $800 million for Zonda in August 2026 and about $730 million for Vexcel, which it agreed to buy in October 2026. If the new data does not raise revenue, this cash earns a low return, and the Vexcel deal makes CoStar borrow on its credit facility. Commercial real estate weakness, such as high office vacancy, can slow subscriptions from brokers, owners and lenders.
- Balance sheet
- Cash: removed: $1.3B added: $500M Debt: $1.0B Net removed: cash: $266M added: debt: $500M EBITDA, last 12 months: removed: $607M added: $722M Net debt / EBITDA: 0.7× (low) Undrawn credit line: $1.1B, to May 2029 Debt due within 12 months: $0.0M Last debt due: 2030 CoStar added: now has more removed: cash added: debt than removed: debt. added: cash. Its only debt is $1.0 billion of 2.800% senior notes due July 15, 2030. Cash is cash and cash equivalents at removed: June added: September 30, removed: 2026, down added: 2026. It fell from $1,633 million at December 31, 2025, because CoStar added: paid $789 million, net of cash acquired, for acquisitions, mainly Zonda, and bought back removed: $589 added: $668 million of shares in the first removed: half added: nine months of 2026. removed: In August 2026, after the balance sheet date, it paid $800 million in cash for Zonda, so cash fell below the debt before Q3 cash flow. EBITDA is adjusted EBITDA for the four quarters to removed: June added: September 2026; GAAP EBITDA added: for the same four quarters was removed: $380 added: $546 million. removed: Nothing was borrowed added: The balance sheet at September 30, 2026 shows no borrowings under the $1.1 billion revolving credit facility, which matures on May 24, 2029. removed: The share buyback program approved in December 2025 allows up added: CoStar plans to removed: $1.5 billion added: pay the price of removed: repurchases. added: about $730 million for Vexcel with cash and this facility, so net debt will rise when the deal closes, which CoStar expects in Q1 2027. As of removed: Jun added: Sep 30, 2026.
- Checkpoints
- Oct 27, 2026: Q3 2026 results: revenue, bookings and Residential profit. removed: Pending. added: Failed. Watch: Revenue within the $935 million to $945 million guide, adjusted EBITDA of $190 million or more and a profitable Residential segment pass; revenue below the guide or bookings that fall again fail. removed: Feb added: Outcome: Revenue of $952 million and adjusted EBITDA of $229 million beat the guide and Residential was profitable, but net new bookings fell again, to $37 million from $69 million in Q2 2026. Jan 27, 2027 (estimate): Full-year 2026 results and 2027 outlook. Pending. Watch: Full-year adjusted EBITDA within removed: $780 added: the raised $820 million to removed: $820 added: $840 million added: outlook, net new bookings above the $37 million of Q3 2026 and a 2027 outlook with double-digit revenue growth pass; a lower revenue outlook added: or bookings that keep falling fail. Q1 2027 (estimate): Vexcel purchase closes. Pending. Watch: The Vexcel purchase closes in Q1 2027, as CoStar expects, at about $730 million passes; a block by regulators or a long delay fails. Jul 2027 (estimate): Q2 2027 results: bookings recovery. Pending. Watch: Net new bookings higher than the $69 million of Q2 2026 pass; bookings that keep falling fail.
- Recent events
- Oct added: 27, 2026: CoStar reported Q3 2026 results. Revenue was $952 million, up 14% and above its guidance of $935 million to $945 million. Net income was $74 million. Adjusted EBITDA was $229 million, about double the year before, and adjusted EPS was $0.38. The Residential segment had adjusted EBITDA of $49 million. Net new bookings were $37 million, down from $84 million in Q3 2025. CoStar raised its 2026 outlook to revenue of $3.75 billion to $3.77 billion, adjusted EBITDA of $820 million to $840 million and adjusted EPS of $1.38 to $1.41. It expects at least $200 million of more cost savings over the next 12 to 18 months. Oct 27, 2026: CoStar agreed to buy Vexcel, a provider of aerial imagery and geospatial data, for about $730 million in cash. Vexcel had more than $140 million of revenue in the last 12 months. CoStar plans to pay with cash and its revolving credit facility. It expects the deal to close in Q1 2027, after regulatory approvals. Oct 1, 2026: CoStar said that it will report Q3 2026 results on October 27, 2026. Sep 14, 2026: CoStar named Felix Kusch, a European home search executive, as President of Homes.com. Aug 21, 2026: CoStar completed the purchase of Zonda, a provider of new-home data, homebuilder software and the NewHomeSource.com and Livabl marketplaces, for $800 million in cash. Jul 29, 2026: CoStar stock fell about 14% before the market opened after the Q2 report, because of the lower revenue outlook and lower bookings. Keefe, Bruyette & Woods downgraded the stock to Market Perform from Outperform and cut its price target to $29 from $41. Jul 28, 2026: CoStar reported Q2 2026 results. Revenue was $925 million, up 18%. Adjusted EBITDA was $184 million, up 116%, and adjusted EPS was $0.32. The Residential segment had positive adjusted EBITDA for the first time. Net new bookings were $69 million. CoStar cut its 2026 revenue outlook to $3.715 billion to $3.755 billion and kept its adjusted EBITDA outlook of $780 million to $820 million and its adjusted EPS outlook of $1.32 to $1.39. Jul 13, 2026: CoStar named Robin Rossmann, its Managing Director for Europe, as Chief Financial Officer from July 31, 2026. He replaced Christian Lown, who left the company. May 29, 2026: CoStar agreed to buy Zonda for $800 million in cash.