CoStar Group (NASDAQ:CSGP) Posts Quarterly Earnings Results, Beats Expectations By $0.04 EPS

CoStar Group (NASDAQ:CSGP) posted its quarterly earnings results on Tuesday. The technology company reported $0.38 EPS for the quarter, beating the consensus estimate of $0.34 by $0.04, FiscalAI reports. CoStar Group had a net margin of 2.08% and a return on equity of 3.74%. The business had revenue of $952.00 million during the quarter, compared to analyst estimates of $945.82 million. During the same quarter in the previous year, the business posted $0.23 EPS. The company’s quarterly revenue was up 14.1% compared to the same quarter last year.

Here are the key takeaways from CoStar Group’s conference call:

• Record profitability: Q3 revenue rose 14% to $952 million, while adjusted EBITDA doubled year over year to a record $229 million. The company raised full-year adjusted EBITDA guidance to $820 million–$840 million, implying a 22% margin.
• Management identified approximately $200 million in additional cost-efficiency opportunities over the next 12–18 months, on top of $150 million in expected 2026 savings. Executives said these savings should support both margin expansion and reinvestment in growth initiatives.
• Annualized net new bookings fell to $37 million from $84 million a year earlier, reflecting economic pressure and insufficient sales capacity. CoStar lowered its full-year revenue outlook excluding Zonda by about 1%, citing weaker Apartments.com subscription revenue and lower Domain transaction volumes.
• Management plans to rebuild sales capacity in 2027, particularly for Apartments.com, CoStar, and Homes.com field sales. Apartments.com ended Q3 with properties down 2% sequentially, while Homes.com bookings and premium advertising pricing improved following the launch of its Platinum product.
• CoStar agreed to acquire aerial-imagery provider Vexcel for approximately $730 million. Management expects the deal to be accretive in the first year, with potential long-term benefits from proprietary AI-generated property data, cross-selling, and international coverage.

CoStar Group Stock Performance

CSGP opened at $27.54 on Thursday. The company has a market cap of $11.16 billion, a PE ratio of 144.95, a price-to-earnings-growth ratio of 0.86 and a beta of 0.80. The company has a debt-to-equity ratio of 0.13, a quick ratio of 2.21 and a current ratio of 2.21. The stock has a 50-day moving average of $30.48 and a 200-day moving average of $37.25. CoStar Group has a 52-week low of $25.89 and a 52-week high of $72.50.

Key Headlines Impacting CoStar Group

Here are the key news stories impacting CoStar Group this week:

• Positive Sentiment: Strong third-quarter results: CoStar reported record revenue of $952 million, up 14% year over year, while earnings of $0.38 per share exceeded the $0.34 consensus estimate. Adjusted EBITDA reached a record $229 million, roughly doubling from the prior year. CoStar Group Reports Record Third Quarter Revenue
• Positive Sentiment: Profit outlook increased: Management raised its 2026 adjusted EBITDA forecast to $820 million-$840 million and is targeting $1.25 billion of adjusted EBITDA in 2028, supported by cost reductions and operating leverage. CoStar raises EBITDA outlook
• Positive Sentiment: Favorable London office trends: CoStar’s data showed strong demand for four-star offices in London’s City Core, where vacancy for best-in-class space has fallen to 2.1%. This supports demand for the company’s real estate data and analytics products. CoStar London office demand data
• Neutral Sentiment: Vexcel acquisition: CoStar agreed to acquire aerial-imagery provider Vexcel for $730 million in cash. The deal could strengthen property search, mapping and 3D visualization capabilities, but investors must weigh the strategic benefits against the sizable cash outlay. CoStar to acquire Vexcel
• Negative Sentiment: Guidance and execution concerns: Despite the revenue beat and higher full-year EBITDA outlook, investors appear concerned about softer near-term expectations, limited bookings growth and weak profitability in the residential business. High interest rates also remain a risk to real estate activity.
• Negative Sentiment: Analyst target reductions: Goldman Sachs, Baird, BTIG Research and Keefe, Bruyette & Woods lowered their price targets, reflecting reduced estimates or caution about the pace of recovery. JPMorgan maintained an overweight rating but also cut its target to $44.

Analyst Upgrades and Downgrades

CSGP has been the subject of several research reports. Keefe, Bruyette & Woods cut shares of CoStar Group from an “outperform” rating to a “market perform” rating and lowered their price objective for the company from $41.00 to $29.00 in a research note on Wednesday, July 29th. Wolfe Research reaffirmed an “outperform” rating and issued a $32.00 target price (down from $35.00) on shares of CoStar Group in a research note on Wednesday, July 29th. Wells Fargo & Company set a $35.00 price objective on CoStar Group in a research note on Wednesday. Citigroup reissued a “market outperform” rating on shares of CoStar Group in a report on Wednesday. Finally, Royal Bank Of Canada set a $34.00 price target on shares of CoStar Group and gave the stock a “sector perform” rating in a research note on Monday, July 13th. Ten equities research analysts have rated the stock with a Buy rating, eight have issued a Hold rating and two have given a Sell rating to the company’s stock. Based on data from MarketBeat, CoStar Group presently has a consensus rating of “Hold” and a consensus price target of $39.11.

Insider Buying and Selling

In other news, CAO Cynthia Cammett Cann sold 4,788 shares of the stock in a transaction that occurred on Friday, August 7th. The stock was sold at an average price of $30.78, for a total value of $147,374.64. Following the completion of the sale, the chief accounting officer owned 18,822 shares of the company’s stock, valued at approximately $579,341.16. This represents a 20.28% decrease in their position. The transaction was disclosed in a filing with the SEC, which can be accessed through the SEC website. Also, CEO Andrew Florance acquired 83,300 shares of the firm’s stock in a transaction that occurred on Tuesday, August 4th. The stock was purchased at an average cost of $29.89 per share, for a total transaction of $2,489,837.00. Following the completion of the purchase, the chief executive officer directly owned 1,806,165 shares of the company’s stock, valued at $53,986,271.85. The trade was a 4.83% increase in their ownership of the stock. Additional details regarding this purchase are available in the official SEC disclosure. 1.18% of the stock is currently owned by corporate insiders.

CoStar Group Company Profile

CoStar Group, Inc is a provider of information, analytics, and online marketplaces for the commercial and residential real estate industries. The company collects, analyzes, and distributes property and market data to real estate professionals, investors, lenders, and other businesses.

Its brands and services include CoStar, which offers commercial real estate data and research; LoopNet, a marketplace for commercial property listings; Apartments.com, a rental housing marketplace; and Homes.com, a residential real estate platform.