Head to Head Survey: CoStar Group (NASDAQ:CSGP) versus Fathom (NASDAQ:FTHM)

CoStar Group (NASDAQ:CSGP) and Fathom (NASDAQ:FTHM) are both real estate companies, but which is the better investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, dividends, risk, valuation, profitability and analyst recommendations.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for CoStar Group and Fathom, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
CoStar Group	2	9	9	0	2.35
Fathom	1	0	0	1	2.50

CoStar Group presently has a consensus target price of $40.11, suggesting a potential upside of 27.24%. Fathom has a consensus target price of $2.50, suggesting a potential upside of 337.29%. Given Fathom’s stronger consensus rating and higher possible upside, analysts clearly believe Fathom is more favorable than CoStar Group.

Institutional and Insider Ownership

96.6% of CoStar Group shares are held by institutional investors. Comparatively, 55.5% of Fathom shares are held by institutional investors. 1.2% of CoStar Group shares are held by insiders. Comparatively, 16.4% of Fathom shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares CoStar Group and Fathom”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
CoStar Group	$3.25 billion	3.93	$7.00 million	$0.19	165.89
Fathom	$406.93 million	0.05	-$20.31 million	($0.80)	-0.71

CoStar Group has higher revenue and earnings than Fathom. Fathom is trading at a lower price-to-earnings ratio than CoStar Group, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

CoStar Group has a beta of 0.75, meaning that its stock price is 25% less volatile than the S&P 500. Comparatively, Fathom has a beta of 2.17, meaning that its stock price is 117% more volatile than the S&P 500.

Profitability

This table compares CoStar Group and Fathom’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
CoStar Group	2.08%	3.74%	2.96%
Fathom	-6.27%	-75.89%	-33.25%

Summary

CoStar Group beats Fathom on 10 of the 15 factors compared between the two stocks.

About CoStar Group

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. The company offers CoStar Property that provides inventory of office, industrial, retail, multifamily, hospitality, and student housing properties and land; CoStar Sales, a robust database of comparable commercial real estate sales transactions; CoStar Market Analytics to view and report on aggregated market and submarket trends; and CoStar Tenant, an online business-to-business prospecting and analytical tool that provides tenant information. It also provides Leasing, a tool to capture, manage, and maintain lease data; CoStar Lease Analysis; Public Record, a searchable database of commercially zoned parcels; CoStar Real Estate Manager, a real estate lease administration, portfolio management, and lease accounting compliance software solution; and CoStar Risk Analytics and CoStar Investment. In addition, it offers apartment marketing sites, such as ApartmentFinder.com, ForRent.com, ApartmentHomeLiving.com, WestsideRentals.com, AFTER55.com, CorporateHousing.com, ForRentUniversity.com, Apartamentos.com, and Off Campus Partners; LoopNet Premium Lister; LoopNet Diamond, Platinum, and Gold Ads; LandsofAmerica.com, LandAndFarm.com, and LandWatch.com for rural land for-sale; BizBuySell.com, BizQuest.com, and FindaFranchise.com for operating businesses and franchises for-sale; Ten-X, an online auction platform for commercial real estate; and HomeSnap, an online and mobile software platform, as well as Homes.com, a homes for sale listings site. The company was founded in 1987 and is headquartered in Washington, the District of Columbia.

About Fathom

Fathom Holdings Inc. provides a real estate services platform that integrates residential brokerage, mortgage, title, and insurance services in the United States. It operates through three segments: Real Estate Brokerage, Mortgage, and Technology. The Real Estate Brokerage segment provides real estate brokerage services. The Mortgage segment offers residential loan origination and underwriting services. The Technology segment provides Software as a Service solutions and data mining for third party customers. It offers access to various properties for sale or lease through its FathomRealty.com website to buyers, sellers, landlords, and tenants; insurance agency services; and title services. In addition, the company provides intelliAgent, a real estate technology platform that offers a suite of brokerage and agent level tools, technology, business processes, business intelligence and reporting, and training; transaction, personnel, customer relationship, and accounting management for agent transactions; and reporting, social media marketing, and other marketing and marketing repository services, as well as marketplace for add-on services and third-party technology. Its brands include Fathom Realty, Dagley Insurance, Encompass Lending, intelliAgent, LiveBy, Real Results, Verus Title, and Cornerstone. The company was founded in 2010 and is headquartered in Cary, North Carolina.