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

CoStar Group (NASDAQ:CSGP) issued its quarterly earnings results on Tuesday. The technology company reported $0.38 earnings per share for the quarter, beating the consensus estimate of $0.34 by $0.04, FiscalAI reports. The business had revenue of $952.00 million during the quarter, compared to analyst estimates of $945.82 million. During the same quarter last year, the firm posted $0.23 earnings per share. The company’s revenue was up 14.1% on a year-over-year basis.

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 Trading Down 5.0%

CSGP stock opened at $32.01 on Wednesday. CoStar Group has a one year low of $25.89 and a one year high of $78.95. The firm has a market capitalization of $12.97 billion, a PE ratio of 168.48 and a beta of 0.80. The firm has a 50-day moving average of $30.56 and a two-hundred day moving average of $37.41.

Insider Transactions at CoStar Group

In related news, CEO Andrew Florance bought 83,300 shares of the business’s stock in a transaction on Tuesday, August 4th. The stock was bought at an average price of $29.89 per share, for a total transaction of $2,489,837.00. Following the transaction, the chief executive officer directly owned 1,806,165 shares in the company, valued at $53,986,271.85. This represents a 4.83% increase in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through this link. Also, CAO Cynthia Cammett Cann sold 4,788 shares of the business’s stock in a transaction that occurred on Friday, August 7th. The shares were 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 directly owned 18,822 shares of the company’s stock, valued at approximately $579,341.16. The trade was a 20.28% decrease in their position. The SEC filing for this sale provides additional information. 1.18% of the stock is owned by corporate insiders.

Key Stories Impacting CoStar Group

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

• Positive Sentiment: CoStar reported record third-quarter revenue of $952 million, up 14% year over year, while adjusted EBITDA reached a record $229 million, roughly doubling from the prior year. Adjusted earnings of $0.38 per share exceeded the $0.34 consensus estimate, and operating cash flow increased substantially. CoStar Group third-quarter results
• Positive Sentiment: Management raised its 2026 adjusted EBITDA outlook to $820 million-$840 million and set a longer-term target of approximately $1.25 billion in adjusted EBITDA by 2028, reinforcing the potential for margin expansion and stronger cash generation. CoStar raises EBITDA outlook
• Positive Sentiment: CoStar agreed to acquire Vexcel Group for approximately $730 million. Vexcel’s survey-grade aerial imagery and geospatial data could enhance search, discovery, analytics, and digital-twin products across CoStar’s platforms. CoStar to acquire Vexcel
• Neutral Sentiment: The quarter’s GAAP net income was $74 million, or $0.18 per diluted share, while revenue was slightly below at least one Wall Street estimate of $965.1 million. The differing adjusted and GAAP figures may be contributing to investor caution.
• Negative Sentiment: Investors appeared to view the outlook and acquisition spending cautiously. The stock’s decline reflects concern that near-term growth may not justify its elevated valuation, with shares trading well below their 200-day moving average and at a high earnings multiple. CoStar third-quarter stock reaction

Analyst Ratings Changes

Several research analysts have commented on the company. Citizens Jmp cut their price objective on CoStar Group from $44.00 to $35.00 and set a “market outperform” rating on the stock in a research report on Wednesday, July 29th. Citigroup reiterated a “market outperform” rating on shares of CoStar Group in a research note on Wednesday. BMO Capital Markets reissued a “market perform” rating and set a $33.00 price target (up from $31.00) on shares of CoStar Group in a research report on Monday, August 24th. JPMorgan Chase & Co. dropped their price target on shares of CoStar Group from $58.00 to $52.00 and set an “overweight” rating for the company in a research note on Wednesday, July 29th. Finally, The Goldman Sachs Group reiterated a “buy” rating and issued a $40.00 target price on shares of CoStar Group in a research report on Wednesday, July 29th. Ten analysts have rated the stock with a Buy rating, eight have assigned a Hold rating and two have given a Sell rating to the company. According to data from MarketBeat, the company currently has a consensus rating of “Hold” and a consensus target price of $40.21.

About CoStar Group

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.