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Verdict
Quantitative factor alignment verified for current market regime.
Quant Score
Rank
#3822
Positioning
Market Dominance
Services
Business Services
$35.7B
Andrew C. Florance
CoStar Group, Inc. provides information, analytics, and online marketplace services to commercial real estate, hospitality, residential, and related professionals industries. It offers CoStar Property that provides inventory of office, industrial, retail, multifamily, and student housing properties and land. The company also provides Lease Comps and Analysis, a tool to capture, manage, and maintain lease data; Lease Analysis; Public Record, a searchable database of commercially-zoned parcels.
Headcount
5.7K
HQ Base
WASHINGTON, District Of Columbia
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X-AXIS: EV/EBITDA (LOWER = CHEAPER) | Y-AXIS: ROE (HIGHER = ELITE) | RED CIRCLE = CSGP ANALYSIS TARGET
| Stock | Rating | Score▼ | Quality | Value | Momentum | P/E | EV/EBITDA | ROE | ROA | Gross Mgn | Op Mgn | Net Mgn | Rev Growth | Div Yield | D/E | Mkt Cap | AUDIT |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
$YALA Yalla Group Ltd | 75 | 89 | 99 | 80 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$GRVY GRAVITY Co., Ltd. | 75 | 82 | 96 | 71 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$ISSC INNOVATIVE SOLUTIONS & SUPPORT INC | 73 | 81 | 88 | 94 | 25.0x | 14.1x | 17.1% | 10.3% | 35.5% | 14.6% | 10.1% | 105.2% | 0.0% | 41.0x | $244M | VS | |
$AER AerCap Holdings N.V. | 72 | 60 | 87 | 84 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$HCSG HEALTHCARE SERVICES GROUP INC | 72 | 74 | 88 | 88 | 7.1x | 6.1x | 28.9% | 20.8% | 20.8% | 9.9% | 9.3% | 8.5% | 0.0% | 1.0x | $1.2B | VS | |
$LQDT LIQUIDITY SERVICES INC | 72 | 90 | 88 | 68 | 24.9x | 14.3x | 14.1% | 8.3% | 45.7% | 8.5% | 6.2% | 28.1% | 0.0% | 0.0x | $736M | VS | |
$TRTNpA Triton International Ltd | 71 | 70 | 89 | 70 | - | 1.7x | 0.0% | - | 97.4% | 58.0% | 37.4% | - | 8.8% | 264.0x | $2.5B | VS | |
$EDU New Oriental Education & Technology Group Inc. | 71 | 83 | 52 | 77 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$NTES NetEase, Inc. | 71 | 88 | 93 | 68 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$UTI UNIVERSAL TECHNICAL INSTITUTE INC | 70 | 86 | 86 | 72 | 43.2x | 16.0x | 15.3% | 5.8% | 100.0% | 6.9% | 5.2% | 15.1% | 0.0% | 24.0x | $1.8B | VS | |
$CSGP COSTAR GROUP, INC. | 38 | 34 | 33 | 38 | 1565.6x | 123.4x | 0.2% | 0.1% | 79.2% | -3.0% | 0.7% | 23.0% | 0.0% | 12.0x | $35.7B | ||
| SECTOR BENCH | - | - | - | - | - | 23.7x | 11.7x | 5.7% | 2.4% | 64.6% | 4.5% | 2.8% | 8.6% | 0.0% | 0.3x | - | REF |
COSTAR GROUP, INC. (CSGP) receives a "Avoid" rating with a composite score of 37.7/100. It ranks #3822 out of 7,333 stocks in our coverage universe and carries a 1-star rating. Ratings are driven by a 6-factor quantitative model measuring quality, value, momentum, investment, stability, and short interest.
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Lagging peers — losers tend to keep underperforming
Expensive relative to fundamentals — limited margin of safety
Weak fundamentals — higher risk of value trap
Low volatility — smoother ride and historically better risk-adjusted returns
Aggressive spending — empire-building risk, dilutive growth
Below-average composite — caution warranted
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Relative valuation derived from Services sector benchmarks. Model weights: EV/EBITDA (40%), P/B (35%), P/S (25%). Re-calculated daily.
Projection based on user-defined inputs. Re-calculated daily against current market data.
Reverse DCF Framework — Mauboussin Methodology
Institutional-grade Reverse DCF analysis. This model identifies the growth hurdles embedded in current market prices. When implied growth is significantly lower than historical or projected rates, a margin of safety may exist. Re-audited daily.
No analyst ratings for CSGP.
View All Ratings| Factor | Global | Sector | Tilt |
|---|---|---|---|
| PROFITABILITY | 34 | 22 | +12ALPHA |
| MOMENTUM | 38 | 35 | +3NEUTRAL |
| VALUATION | 33 | 26 | +7ALPHA |
| INVESTMENT | 21 | 5 | +16ALPHA |
| STABILITY | 63 | 68 | -5NEUTRAL |
| SHORT INT | 47 | 45 | +2NEUTRAL |
Global = full universe. Sector = relative to industry peers. Positive tilt indicates idiosyncratic strength.
ROE proxy 0.2% (sector 5.7%)
GM 79% vs sector 65%, OM -3% vs sector 5%
Capital turnover N/A, R&D intensity 4.5%
Rev growth 23%, 10yr history
Interest coverage N/A, Net debt/EBITDA -23.0x
Composite assessment of profitability, capital efficiency, and financial strength. Top-tier entities demonstrate sustainable cash flow generation and elite competitive moats.
Profit generated per dollar of shareholder equity
Efficiency of asset utilization
Pricing power and cost efficiency
Core business profitability
Bottom-line profitability
The Quality factor evaluates the persistence and magnitude of realized cash flows. Companies with scores >70 exhibit superior pricing power and structural financial resilience through diverse economic regimes.
Our uncertainty rating tracks the predictability of future cash flows and potential for permanent capital loss. Moderate visibility with standard industry cyclicality.
We rate COSTAR GROUP, INC. (CSGP) as Avoid with a composite score of 37.7/100 at a current price of $45.89. The stock falls in the bottom quintile, and the multi-factor weakness suggests a high probability of continued underperformance.
COSTAR GROUP, INC. holds a top-quartile position (#0 of 50) within the Services sector, based on our composite quantitative scoring across quality, value, momentum, and stability factors. The composite score of 37.7/100 places it at rank #3822 in our full universe.
No Moat
Low
Standard
Fair Value
Gross margins of 79% signal strong pricing power.
Stable competitive position in a defensive sector.
Elevated P/E ratio of 1565.6x leaves little room for execution misses.
Below-average quality raises earnings sustainability concerns.
Vulnerability to macroeconomic shocks and interest rate volatility.
COSTAR GROUP, INC. represents a avoid based on multi-factor quantitative performance.
Our quantitative model flags COSTAR GROUP, INC. with an Avoid rating, assigning a composite score of 37.7/100 and 1 out of 5 stars. Ranked #3822 of 7,333 stocks, CSGP falls in the bottom tier across key factors. Historically, stocks with this profile have faced elevated risk of underperformance and capital loss.
CSGP's quality score of 34/100 is below average, suggesting challenges with profitability or capital efficiency. The company reports a return on equity of 0.2% (sector avg: 5.7%), gross margins of 79.2% (sector avg: 64.6%), net margins of 0.7% (sector avg: 2.8%). Investors should examine whether management is actively addressing these weaknesses or if they reflect structural industry headwinds.
With a value score of 33/100, CSGP appears somewhat expensive relative to its fundamentals. Key valuation metrics include a P/E ratio of 1565.63x, an EV/EBITDA of 123.43x, a P/B ratio of 2.45x. Investors paying a premium here are likely betting on above-average growth or margin expansion to justify current prices.
COSTAR GROUP, INC.'s investment score of 21/100 suggests limited reinvestment activity. Key growth metrics include revenue growth of 23.0% vs. a sector average of 8.6% and a return on assets of 0.1% (sector: 2.4%). While this can be positive for mature, cash-generative businesses returning capital to shareholders, it may also signal a lack of growth opportunities or management conservatism.
CSGP is currently showing below-average momentum at 38/100, which may indicate weakening institutional interest or negative sentiment shifts. Revenue growth stands at 23.0% year-over-year, while a beta of 0.91 reflects its sensitivity to broader market moves. Investors should note that declining momentum can precede further price weakness, though contrarian opportunities sometimes emerge at these levels.
With a stability score of 63/100, CSGP exhibits average financial resilience. Key stability metrics include a beta of 0.91 and a debt-to-equity ratio of 12.00x (sector avg: 0.3x). While the balance sheet is not a major concern, the stock is subject to typical market volatility and may experience sharper drawdowns during risk-off episodes.
The short interest score of 47/100 for CSGP suggests somewhat elevated bearish positioning by institutional traders. Specific risk factors include elevated leverage (D/E: 12.00x). With a $35.7B market cap (large-cap), COSTAR GROUP, INC. may experience above-average volatility. Investors should consider whether the short thesis has merit or if it creates a potential short-squeeze opportunity.
COSTAR GROUP, INC. is a large-cap company in the Services sector, ranked #0 of 50 in its sector (100th percentile) and #3822 of 7,333 overall (48th percentile). Key comparisons include ROE of 0.2% trailing the 5.7% sector median and operating margins of -3.0% below the 4.5% sector average. This top-quartile standing reflects exceptional competitive strength relative to Services peers.
While CSGP currently exhibits a AVOID profile, superior opportunities exist within the SERVICES sector. Our model identifies several "Strong Buy" candidates with higher quality scores and more attractive valuations among direct industry competitors.
View Top Services Alpha →Quant Factor Profile
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Improvement in Investment (21) would have the largest impact on the composite score.
EV/EBITDA 952% ABOVE SECTOR MEDIAN
ROE 97% BELOW SECTOR MEDIAN
Gross Margin 23% ABOVE SECTOR MEDIAN (FAVORABLE)
Above 50MA
37.18%
Net New Highs
+51081
With expectations of Federal Reserve rate cuts, two real estate-focused stocks - Zillow and CoStar Group - are positioned to benefit from potential lower mortgage rates and increased housing market activity.
ARLINGTON, Va., February 24, 2026--CoStar Group, Inc. (NASDAQ: CSGP), a leading provider of online real estate marketplaces, information, analytics, and 3D digital twin technology in the property markets, announced today that revenue for the year ended December 31, 2025 was $3.2 billion, up 19% over revenue of $2.7 billion for the full year of 2024. Revenue for the fourth quarter of 2025 was $900 million, an increase of 27% over revenue of $709 million for the fourth quarter of 2024.
Technology has become a differentiator for real estate companies, as seen in CoStar's acquisition of Matterport and Zillow's launch of showcase homes. This technology is a key factor for investors in these companies.
CoStar Group, the leading commercial real estate listing platform, reported disappointing Q3 results with revenue growth falling short of expectations. The company also provided underwhelming guidance for the full year, leading to a decline in the stock price.