CoStar Group Inc (CSGP)
Real EstateReal Estate ServicesUndervalued
Price: $30.96 · Nov 13, 2026Analysis of Nov 10, 2026
Fair value
- Fair value · Low
- $50.81
- Fair value · Mid
- $63.51
- Fair value · High
- $76.21
Scorecard
Five subjects rated by the server with fixed thresholds. No overall grade: each colour shows where the strength or the weakness is.
Altman zone: Safe (Z 4.12) · annual report of Dec 31, 2025
Undervalued
Analysis
Conclusion
CoStar Group provides property information, analytics and online marketplaces for the commercial and residential real estate industry, including CoStar Property, LoopNet, Homes.com and Ten-X. At 31.24 USD on 2026-11-09, the market capitalisation is 12.57 billion USD.
The verdict is undervalued. The price-to-earnings ratio is 70.2 against a ten-year median of 84.5, a premium of -16.9%. The enterprise value to EBITDA multiple is 23.0 against a median of 45.5, a premium of -49.5%. The price-to-free-cash-flow ratio is 192.2 against a median of 60.7, a premium of 216.5%. The fair value band runs from 50.81 to 76.21 USD with a midpoint of 63.51 USD, a margin of safety of 103.3% at the current price. The fair value from historical multiples is 63.51 USD. The discounted cash flow value and the reverse DCF are not available in the data. Revenue has compounded at 14.4% over five years, but earnings per share has fallen at -51.1% a year over the same period.
The strongest numbers are the Altman Z-score of 4.115, interest coverage of 21.1 and five-year free cash flow conversion of 91.7%. The weakest are ROIC minus WACC of -6.68%, with ROIC at 1.73% against a WACC of 8.41%, trailing free cash flow conversion of 36.5%, and free cash flow after stock-based compensation of -87.6 million USD.
Financial health
Financial strength is green, held up by the Altman Z-score of 4.115, net debt to EBITDA of 1.17, interest coverage of 21.1 and a current ratio of 1.32. The quick ratio is 1.13 and debt to equity is 0.147, both as of 2026-09-30. The Altman model was designed for manufacturers, so its reading is approximate for this information and services business. The Altman zone is safe. Insolvency risk: low, about 0.12% by the estimate of the Ohlson model over one to two years, based on 2025-12-31 figures. Net debt has fallen over five years, with the five-year change in debt relative to revenue growth at -14.0%.
Earnings quality
Earnings quality is yellow. Free cash flow conversion is 91.7% over five years, which supports it, but trailing conversion has dropped to 36.5%. The accrual ratio is -0.0427, a favourable sign. Stock-based compensation equals 4.2% of revenue, and free cash flow after it is -87.6 million USD on a trailing basis. The share count has grown at 1.9% a year over five years, so there are no net buybacks. The Piotroski score is 5 of 9. The Beneish M-score is not available. CoStar beat earnings estimates in all 8 of the last quarters, with an average surprise of 20.5%. Estimates for the current year rose 3.5% over 90 days, and estimates for next year rose 2.6%, with next-year growth expected at 25.9%.
Profitability
Profitability is red. The gross margin is 76.2% against a ten-year median of 79.5%. The operating margin is 5.8% against a median of 17.7%, and the net margin is 4.9% against a median of 14.4%. Operating margin stability is 0.586. ROIC is 1.73% against a WACC of 8.41%, and ROIC minus WACC is -6.68%, which means the company is destroying value. The five-year median ROIC is 9.44%. Return on equity is 2.2%. The DuPont split, as of 2025-12-31, shows a net margin of 0.22%, asset turnover of 0.308 and an equity multiplier of 1.26, so leverage is not inflating the return.
Growth
Growth is yellow. Revenue compound growth is 14.2% over three years, 14.4% over five years and 16.4% over ten years. Revenue has grown in all 10 of the last 10 years. Earnings per share has fallen at -73.8% a year over three years and -51.1% over five years. Free cash flow per share has fallen at -54.8% over three years, -38.9% over five years and -11.4% over ten years. Consensus expects earnings per share growth of 25.9% next year, which is the main support for the growth case.
Valuation
Valuation is green, based on an undervalued verdict and a margin of safety of 103.3%. The price-to-earnings ratio is 70.2 against a ten-year median of 84.5. The enterprise value to EBITDA multiple is 23.0 against 45.5, and the price-to-sales ratio is 3.42 against 12.74. The price-to-book ratio is 1.58 against 4.36. The free cash flow yield is 0.5% and the earnings yield is 1.4%. The price-to-free-cash-flow ratio is 192.2 against 60.7, a premium of 216.5%. The fair value band runs from 50.81 to 76.21 USD with a midpoint of 63.51 USD. The discounted cash flow value is not available, and the base free cash flow is negative at -87.6 million USD. The reverse DCF implied growth is not available. The company pays no dividend.
Risks
The main risk is that the low returns persist. A ROIC of 1.73% against a WACC of 8.41% means each dollar invested is not yet earning its cost of capital, so the multiples discount may not close. Trailing free cash flow conversion of 36.5% and free cash flow after stock-based compensation of -87.6 million USD show that reported earnings are not yet turning into cash for shareholders. The fall in earnings per share over three and five years makes the forecast 25.9% growth next year the critical test. The discounted cash flow value and the reverse DCF are not available, and the fair value band rests on historical multiples. The Beneish M-score is not available. The analysis has no debt maturity schedule and no revenue by segment, so it cannot assess refinancing timing or which business lines drive growth.
Metrics
Company
| Name | CoStar Group Inc |
|---|---|
| Sector | Real Estate |
| Symbol | CSGP.US |
| Country | USA |
| Currency | USD |
| Industry | Real Estate Services |
| Description | CoStar Group, Inc. provides information, analytics, and online marketplace services to real estate and related business communities in the United States, Australia, Canada, Europe, the Asia Pacific, and Latin America. It offers CoStar Property that provides inventory of office, industrial, retail, multifamily, hospitality, and student housing, and land properties; CoStar Leasing, a data on lease transactions and tools to manage user-entered lease data; CoStar Sales, a database of commercial real estate sales transactions; CoStar Owners provides detailed portfolio information; CoStar Markets to view and report on market and submarket trends; and CoStar Tenant that provides tenant information. The company also provides hospitality benchmarking that allows hotels to measure performance against competitors; Debt Solutions, a tool for lenders to manage loan portfolios and risk; and real estate and lease management technology solutions, such as lease administration, lease accounting, and transaction management services. In addition, it offers Apartamentos.com, an apartment marketing sites; LoopNet.com, a commercial property marketing sites; Homes.com, a home for sale listings site; Ten-X, an online auction platform for commercial real estate; Land.com, a marketplace for rural land sales; and BizBuySell.com, a marketplace for operating businesses and franchises for sale. It serves sales, leasing, and mortgage brokers; property, real estate investment trust, insurance companies, and |
| Fiscal year end | December |
Data dates
| Price | 2026-11-09 |
|---|---|
| Statements | 2026-09-30 |
| Risk free date | 2026-11-09 |
| Fundamentals fetched at | 2026-11-06T03:33:21.426Z |
Market
| Beta | 0.78 |
|---|---|
| Price | 31.24 |
| Market cap | 12,569,018,127 |
| Quote unit | USD |
| Shares now | 402,337,328 |
| Risk free rate | 0.0489 |
| Risk free symbol | US10Y |
| Enterprise value | 13,241,018,127 |
Financial health
| Altman z | 4.115SAFE |
|---|---|
| Quick ratio | 1.1257 |
| Current ratio | 1.3212OK |
| Debt to equity | 0.147 |
| Net debt to ebitda | 1.1669OK |
| Interest coverage | 21.0917OK |
| Debt vs revenue growth5y | -0.1403 |
Earnings quality
| Beneish › M | — |
|---|---|
| Beneish › Label | — |
| Piotroski › Score | 5 |
| Piotroski › Passed | 5 |
| Piotroski › Evaluable | 9 |
| Fcf after sbc | -87,600,000 |
| Accrual ratio | -0.0427 |
| Sbc to revenue | 0.0416 |
| Fcf conversion5y | 0.9171 |
| Fcf conversion ttm | 0.3654 |
| Share count cagr5y | 0.0188 |
| Earnings surprises › Beats | 8 |
| Earnings surprises › Misses | 0 |
| Earnings surprises › Quarters | 8 |
| Earnings surprises › Average surprise pct | 20.5147 |
| Estimate revisions › Next year › Growth | 0.259 |
| Estimate revisions › Next year › Change90d | 0.0255 |
| Estimate revisions › Next year › Up last30d | 1 |
| Estimate revisions › Next year › Down last30d | 1 |
| Estimate revisions › Current year › Change90d | 0.0352 |
| Estimate revisions › Current year › Up last30d | 1 |
| Estimate revisions › Current year › Down last30d | 1 |
Profitability
| Roic | 0.0173 |
|---|---|
| Wacc | 0.0841 |
| Dupont › As of | 2025-12-31 |
| Dupont › Net margin | 0.0022 |
| Dupont › Asset turnover | 0.3081 |
| Dupont › Equity multiplier | 1.2645 |
| Tax rate | 0.35 |
| Net margin | 0.0487 |
| Cost of debt | 0.0489 |
| Gross margin | 0.7618 |
| Cost of equity | 0.089 |
| Roic median5y | 0.0944 |
| Roic minus wacc | -0.0668DESTROYS_VALUE |
| Return on equity | 0.0224 |
| Net margin median | 0.1437 |
| Operating margin | 0.0578 |
| Gross margin median | 0.7946 |
| Operating margin median | 0.1772 |
| Operating margin stability | 0.5863 |
Growth
| Eps › Cagr3y | -0.7384 |
|---|---|
| Eps › Cagr5y | -0.5106 |
| Eps › Cagr10y | — |
| Revenue › Cagr3y | 0.1416 |
| Revenue › Cagr5y | 0.1437 |
| Revenue › Cagr10y | 0.1639 |
| Fcf per share › Cagr3y | -0.5481 |
| Fcf per share › Cagr5y | -0.3888 |
| Fcf per share › Cagr10y | -0.1142 |
| Revenue growth consistency › Growing years | 10 |
| Revenue growth consistency › Comparable years | 10 |
Valuation
| Dcf › G1 | — |
|---|---|
| Dcf › G t | 0.025 |
| Dcf › Fcf0 | -87,600,000 |
| Dcf › Discount rate | 0.089 |
| Dcf › Terminal share | — |
| Dcf › Fair value per share | — |
| Current › Pb | 1.5761 |
| Current › Pe | 70.218 |
| Current › Ps | 3.4211 |
| Current › P fcf | 192.1868 |
| Current › Fcf yield | 0.0052 |
| Current › Ev to ebitda | 22.9919 |
| Current › Earnings yield | 0.0142 |
| Verdict | UNDERVALUED |
| Fair value › Low | 50.8098 |
| Fair value › Mid | 63.5122 |
| Fair value › High | 76.2147 |
| Fair value › Margin of safety | 1.033 |
| Historical › Pb › Median | 4.3606 |
| Historical › Pb › Points | 10 |
| Historical › Pb › Current | 1.5761 |
| Historical › Pb › Premium pct | -0.6386 |
| Historical › Pe › Median | 84.4564 |
| Historical › Pe › Points | 10 |
| Historical › Pe › Current | 70.218 |
| Historical › Pe › Premium pct | -0.1686 |
| Historical › Ps › Median | 12.7427 |
| Historical › Ps › Points | 10 |
| Historical › Ps › Current | 3.4211 |
| Historical › Ps › Premium pct | -0.7315 |
| Historical › P fcf › Median | 60.7268 |
| Historical › P fcf › Points | 9 |
| Historical › P fcf › Current | 192.1868 |
| Historical › P fcf › Premium pct | 2.1648 |
| Historical › Ev to ebitda › Median | 45.538 |
| Historical › Ev to ebitda › Points | 10 |
| Historical › Ev to ebitda › Current | 22.9919 |
| Historical › Ev to ebitda › Premium pct | -0.4951 |
| Reverse dcf › Implied growth | — |
| Reverse dcf › Vs revenue cagr5y | — |
| Reverse dcf › Vs fcf per share cagr5y | — |
| Historical fair value | 63.5122 |
Dividend
| Yield | — |
|---|---|
| Payout on fcf | — |
| Forward yield | 0 |
Notes
| Notes | NEGATIVE_FCF |
|---|
Data flags
| Prices stale | No |
|---|---|
| Risk free stale | No |
| Fundamentals stale | No |