Key Stats for CoStar Group Stock
- Earnings Reaction: -8.9%
- Current Price: $44.78
- Valuation Model Target: $107.03
Now Live: Discover how much upside your favorite stocks could have using TIKR’s new Valuation Model (It’s free)>>>
What Happened?
CoStar Group (CSGP) is navigating a strategic consolidation phase, with shares trading near $44.78 following a highly complex but fundamentally dominant fourth quarter earnings release.
The real estate data behemoth delivered a blowout 2025, crushing top-line estimates with $3.2 billion in full-year revenue (a 19% increase) and posting a massive 83% surge in adjusted EBITDA to $442 million.
However, management immediately signaled that they are aggressively funneling these record profits back into the business to fund a massive wave of global expansion and technological development in 2026.
While the U.S. commercial real estate market is rapidly shifting from a post-COVID headwind to a tailwind, with office absorption turning positive and commercial sales volumes climbing 30%, CoStar is refusing to rest on its laurels.
CEO Andy Florance detailed exactly why the company is aggressively expanding its product suite to capture billions in new total addressable market (TAM).
Florance stated verbatim: “We are scaling Homes.com because it strengthens our entire real estate ecosystem globally and the completeness of our data. And we’re doing it with a clear investment glide path. And on AI, we’re not conceding the future.”
This investment phase includes building CoStar Australia from scratch, expanding the LoopNet marketplace deeper into Europe, and launching a highly disruptive, first-of-its-kind commercial lease benchmarking product.
See analysts’ growth forecasts and price targets for CoStar Group stock (It’s free!) >>>
Is CoStar Group Undervalued Today?
The TIKR Model indicates that the market is excessively focused on the short-term margin compression required to fund these 2026 investments, fundamentally ignoring the massive long-term revenue streams being created.
The model projects a massive target price of $107.03, representing an exceptional 139.0% potential total return from current levels.
The sheer volume of proprietary data CoStar is accumulating provides an impenetrable competitive moat in the artificial intelligence era.
Last week, the company launched Homes AI, a revolutionary conversational interface that utilizes multiple Large Language Models (LLMs) to guide homebuyers through the search process.
Because CoStar fiercely protects its 2.4 trillion fields of proprietary data, competitor AI models cannot access or replicate this functionality.
CFO Chris Lown explained exactly why the company is willing to absorb temporary margin impacts in 2026 to fund this technological dominance.
Lown stated verbatim: “We expect adjusted EBITDA margins for 2026 of 33% to 34% as we make a number of significant investments in the commercial segment to drive future growth. These investments include building CoStar Australia and expanding in Europe, CoStar Debt Solutions origination workflow modules, the integration of Real Estate Manager and Visual Lease into CoStar, the revolutionary lease benchmarking product, a new homes information product profitability modules, AI across our businesses, new Matterport technology and additional salespeople.”
Read the full CoStar Group Transcript on TIKR to see the 2026 guidance breakdown >>>
Valuation Deep Dive
The TIKR Advanced Valuation Model identifies CoStar Group as an apex predator in the real estate data space, utilizing its massive profitability to systematically crush competitors and enter new verticals.
- Target Price: $107.03
- Current Price: $44.78
- Annualized Return (IRR): 19.7%
The Residential Marketplace Monopoly: CoStar is aggressively attacking the residential real estate portal market, utilizing the massive cash flow from its commercial business to fund the expansion of Homes.com and Apartments.com. In just two years, Homes.com has become the fastest-growing residential portal in the U.S., achieving 100 million average monthly unique visitors. By transitioning from top-of-funnel brand awareness to high conversion, AI-driven product marketing, CoStar is methodically stripping market share away from legacy competitors like Zillow and Redfin.
Debt Solutions and Corporate Real Estate: Beyond residential, CoStar is quietly building billion-dollar businesses within its commercial segment. The newly rebranded CoStar Debt Solutions product has already surpassed a $100 million annual revenue run rate. Management sees a clear path to a $1 billion opportunity by aggressively expanding into loan origination workflow solutions. Simultaneously, the integration of Real Estate Manager and Visual Lease will create an undisputed corporate real estate software monopoly.
Conclusion: A highly dominant data monopoly is choosing to aggressively reinvest record profits to conquer new global markets. CoStar Group offers a massive 139.0% projected total return potential. The path to the $107.03 target is paved by impenetrable proprietary data moats, revolutionary AI deployments, and rapid expansion into the residential and debt markets.
See what stocks billionaire investors are buying so you can follow the smart money with TIKR.
How Much Upside Does CoStar Group Stock Have From Here?
With TIKR’s new Valuation Model tool, you can estimate a stock’s potential share price in under a minute.
All it takes is three simple inputs:
- Revenue Growth
- Operating Margins
- Exit P/E Multiple
If you’re not sure what to enter, TIKR automatically fills in each input using analysts’ consensus estimates, giving you a quick, reliable starting point.
From there, TIKR calculates the potential share price and total returns under Bull, Base, and Bear scenarios so you can quickly see whether a stock looks undervalued or overvalued.
See a stock’s true value in under 60 seconds (Free with TIKR) >>>
Looking for New Opportunities?
- See what stocks billionaire investors are buying so you can follow the smart money.
- Analyze stocks in as little as 5 minutes with TIKR’s all-in-one, easy-to-use platform.
- The more rocks you overturn… the more opportunities you’ll uncover. Search 100K+ global stocks, global top investor holdings, and more with TIKR.
Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
