Is CoStar Group Stock Underperforming the S&P 500?
CoStar Group, Inc. (CSGP), headquartered in Arlington, Virginia, provides information, analytics, and online marketplace services. Valued at $34.5 billion by market cap, the company offers a subscription-based integrated platform for commercial real estate intelligence, which includes information about commercial real estate properties, properties for sale, comparable sales, tenants, space available for lease, industry news, and market status.
Companies worth $10 billion or more are generally described as “large-cap stocks,” and CSGP perfectly fits that description, with its market cap exceeding this mark, underscoring its size, influence, and dominance within the real estate services industry. CSGP is a leader in the commercial real estate information arena, known for brands like CoStar Suite and LoopNet. Its strong brand recognition has helped maintain a loyal customer base and attract new subscribers, leading to steady revenue growth.
Despite its notable strength, CSGP slipped 1.6% from its 52-week high of $83.68, achieved on Apr. 23. Shares of CSGP gained 7.2% over the past three months, underperforming the S&P 500 Index’s ($SPX) 8% rise during the same time frame.
In the longer term, shares of CSGP rose 15.1% on a YTD basis, outperforming SPX’s YTD gains of 2.8%. However, the stock climbed 6.1% over the past 52 weeks, underperforming SPX’s 11.5% returns over the last year.
To confirm the bullish trend, CSGP is trading above its 50-day moving average recently. The stock has been trading above its 200-day moving average since early March, experiencing fluctuations.
CSGP’s weak performance was driven by a $31 million impact from the Matterport acquisition.
On Apr. 29, CSGP reported its Q1 results, and its shares closed down more than 10% in the following trading session. Its adjusted EPS of $0.14 beat Wall Street expectations of $0.11. The company’s revenue was $732.2 million, exceeding Wall Street forecasts of $719.4 million. The company expects full-year revenue in the range of $3.1 billion to $3.2 billion.
In the competitive arena of real estate services, CBRE Group, Inc. (CBRE) has taken the lead over CSGP, showing resilience with a 52.2% uptick over the past 52 weeks but lagged behind the stock with 3.2% gains on a YTD basis.
Wall Street analysts are moderately bullish on CSGP’s prospects. The stock has a consensus “Moderate Buy” rating from the 15 analysts covering it, and the mean price target of $86 suggests a potential upside of 4.4% from current price levels.
On the date of publication, Neha Panjwani did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.