5 Insightful Analyst Questions From CoStar's Q1 Earnings Call
CoStar's first quarter results were met with a marked negative market reaction, as concerns emerged regarding the company's forward outlook despite solid operational performance. Management pointed to ongoing double-digit revenue growth, with CEO Andy Florance highlighting strong momentum in the core commercial real estate data and marketplace businesses and the integration of recent acquisitions such as Matterport. However, Florance acknowledged continued headwinds in the broader commercial real estate environment, describing conditions as 'one of the worst commercial real estate environments in decades,' with high office vacancies and weak transaction volumes. The company also experienced significant cost reductions, particularly in the Homes.com business, and noted a sharp improvement in customer retention metrics following product repositioning.
Is now the time to buy CSGP? Find out in our full research report (it's free).
Revenue: $732.2 million vs analyst estimates of $730 million (11.5% year-on-year growth, in line)
Adjusted EPS: $0.19 vs analyst estimates of $0.11 (81.7% beat)
Adjusted EBITDA: $65.6 million vs analyst estimates of $30.51 million (9% margin, significant beat)
Revenue Guidance for the full year is $3.14 billion at the midpoint, roughly in line with what analysts were expecting
EBITDA guidance for the full year is $370 million at the midpoint, below analyst estimates of $389.9 million
Operating Margin: -5.8%, in line with the same quarter last year
Market Capitalization: $34.17 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Alexei Gogolev (JPMorgan) asked about the industry's response to Zillow's delayed market listing policy. CEO Andy Florance reported 'overwhelmingly negative' feedback from agents and positioned this as a competitive opportunity for Homes.com.
Peter Christiansen (Citi) inquired about Matterport's integration timeline and monetization. Florance highlighted plans for deep product embedding and R&D expansion, while CFO Christian Lown emphasized expected reductions in customer cancellations as usage increases.
George Tong (Goldman Sachs) questioned investment levels for Homes.com and the impact of the Board's capital allocation committee. Lown confirmed investment plans remain unchanged, with cost savings being reallocated to sales force growth.
Ryan Tomasello (KBW) asked about the deceleration in multifamily growth and the outlook for Apartments.com. Lown explained that seasonal dynamics and new sales hires will drive acceleration in the second half, and the addition of experienced sales staff is expected to improve results.
Stephen Sheldon (William Blair) queried the potential for more aggressive pricing in the CoStar Suite. Florance suggested that as market conditions improve, the company may pursue higher annual price increases, but will remain cautious if headwinds persist.
Over the next few quarters, the StockStory team will focus on (1) the pace of Homes.com sales force expansion and its impact on net new bookings, (2) the effectiveness of Matterport's integration in driving higher engagement and retention across the product suite, and (3) signs of improvement in commercial real estate transaction volumes and office vacancy rates. Execution on cost control and the ability to successfully monetize new product offerings will also be key indicators of progress.
CoStar currently trades at $81, down from $82.61 just before the earnings. At this price, is it a buy or sell? See for yourself in our full research report (it's free).
Market indices reached historic highs following Donald Trump's presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth.
While this has caused many investors to adopt a "fearful" wait-and-see approach, we're leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Journals
3 days ago
- Business Journals
Why Westerville: Future-ready, trusted partners
According to Costar, a commercial real estate database, nearly 90% of Westerville's 10.8 million square feet of non-residential space stands occupied as of June 2025. That figure indicates what Westerville businesses, from small merchants in Uptown to large publicly traded corporations in the Polaris-area Westar business district already know: Westerville continues to top the list of locations for businesses to grow and thrive. What makes Westerville a stand-out location in the Columbus region? Location, location, location Westerville's proximity to major highways and the John Glenn International Airport (CMH) offers seamless access to regional and national markets. It's also situated in one of the fastest-growing parts of the state, with access to talent in southern Delaware County and northern Franklin County. This combination of location advantages and a supportive business environment makes Westerville an ideal choice for companies looking to establish or expand their presence in central Ohio. World-class municipal utilities Westerville is the only community in the Columbus Region with three of its own public utilities: electric, water, and WeConnect — the nation's only municipally owned and operated and publicly accessible data center and fiber network. Local control over utilities equates to the highest standards of public service excellence and affordable rates. Shovel-ready sites in amenity-rich areas In Westar, the City of Westerville serves as the 'master developer' for sites and infrastructure. This model expedites the development process and gives companies the flexibility of choosing their own developer and contractor teams. Westar is also known for its proximity to amenities in a walkable, park-like setting, making Westerville an ideal place for talent attraction and retention. This list of qualities would appeal to any site selector. But there's always more to location decisions than just the bottom line. Sense of place Uptown Westerville is one of the best preserved and most authentic historic centers in Ohio. Uptown's blend of historic buildings, vibrant streetscape, wide range of shops, boutiques and restaurants as well as community events like Fourth Fridays make it a true gathering spot with a memorable sense of place. Designated a National Register Historic District in 2019, the City continues to place a high priority on promoting an 'Authentic and Alive Uptown.' In 2024, Uptown Westerville played host to more than 60 community events which welcomed approximately 160,000 in attendance and accounted for nearly a $4 million economic impact for local businesses. Westerville partnership Westerville is a place where innovation and tradition work hand-in-hand and where success is more than growth and a high occupancy rate. For Westerville, success is about being future-ready and trusted partners for our businesses. With the goal of advancing Westerville authentically and responsibly, the City takes a personalized and solutions-oriented approach to development, while leveraging a broad network of regional partners like the Westerville Area Chamber, Otterbein University, the Delaware County Finance Authority and many others. 'Westerville has thrived on creating a business ecosystem that fosters less competition and more collaboration,' said Mike Ashanin, chief operating officer for Central Ohio Primary Care Physicians, whose three-building headquarters and medical office campus is located in Westar. 'Their commitment to resources, amenities and a dedication to blending the old and the new together has resulted in a vibrant community that makes it a great place to work and stay.' expand The City of Westerville is in a prime location for businesses seeking a balance of suburban tranquility and urban access. Its proximity to major highways and airways facilitates seamless access to global markets and makes Westerville an ideal choice for companies looking to establish or expand in central Ohio. For more about Westerville's thriving business climate, visit Westerville is a full-service city of more than 40,000 residents and a leader in job creation. Known as a 'City within a Park,' Westerville boasts more than 41 parks and 51 miles of trails. The City operates its own electric and water utilities, data center, fire/EMS and police. Rachel Ray leads the City of Westerville's Economic Development division, administering the City's business retention, expansion and attraction programs and managing economic development and incentive projects. She also serves on the Mid-Ohio Development Exchange (MODE) board of trustees.
Yahoo
4 days ago
- Yahoo
5 Insightful Analyst Questions From CoStar's Q1 Earnings Call
CoStar's first quarter results were met with a marked negative market reaction, as concerns emerged regarding the company's forward outlook despite solid operational performance. Management pointed to ongoing double-digit revenue growth, with CEO Andy Florance highlighting strong momentum in the core commercial real estate data and marketplace businesses and the integration of recent acquisitions such as Matterport. However, Florance acknowledged continued headwinds in the broader commercial real estate environment, describing conditions as 'one of the worst commercial real estate environments in decades,' with high office vacancies and weak transaction volumes. The company also experienced significant cost reductions, particularly in the business, and noted a sharp improvement in customer retention metrics following product repositioning. Is now the time to buy CSGP? Find out in our full research report (it's free). Revenue: $732.2 million vs analyst estimates of $730 million (11.5% year-on-year growth, in line) Adjusted EPS: $0.19 vs analyst estimates of $0.11 (81.7% beat) Adjusted EBITDA: $65.6 million vs analyst estimates of $30.51 million (9% margin, significant beat) Revenue Guidance for the full year is $3.14 billion at the midpoint, roughly in line with what analysts were expecting EBITDA guidance for the full year is $370 million at the midpoint, below analyst estimates of $389.9 million Operating Margin: -5.8%, in line with the same quarter last year Market Capitalization: $34.17 billion While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention. Alexei Gogolev (JPMorgan) asked about the industry's response to Zillow's delayed market listing policy. CEO Andy Florance reported 'overwhelmingly negative' feedback from agents and positioned this as a competitive opportunity for Peter Christiansen (Citi) inquired about Matterport's integration timeline and monetization. Florance highlighted plans for deep product embedding and R&D expansion, while CFO Christian Lown emphasized expected reductions in customer cancellations as usage increases. George Tong (Goldman Sachs) questioned investment levels for and the impact of the Board's capital allocation committee. Lown confirmed investment plans remain unchanged, with cost savings being reallocated to sales force growth. Ryan Tomasello (KBW) asked about the deceleration in multifamily growth and the outlook for Lown explained that seasonal dynamics and new sales hires will drive acceleration in the second half, and the addition of experienced sales staff is expected to improve results. Stephen Sheldon (William Blair) queried the potential for more aggressive pricing in the CoStar Suite. Florance suggested that as market conditions improve, the company may pursue higher annual price increases, but will remain cautious if headwinds persist. Over the next few quarters, the StockStory team will focus on (1) the pace of sales force expansion and its impact on net new bookings, (2) the effectiveness of Matterport's integration in driving higher engagement and retention across the product suite, and (3) signs of improvement in commercial real estate transaction volumes and office vacancy rates. Execution on cost control and the ability to successfully monetize new product offerings will also be key indicators of progress. CoStar currently trades at $81, down from $82.61 just before the earnings. At this price, is it a buy or sell? See for yourself in our full research report (it's free). Market indices reached historic highs following Donald Trump's presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth. While this has caused many investors to adopt a "fearful" wait-and-see approach, we're leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today.
Yahoo
5 days ago
- Yahoo
Data & Business Process Services Stocks Q1 In Review: CoStar (NASDAQ:CSGP) Vs Peers
The end of the earnings season is always a good time to take a step back and see who shined (and who not so much). Let's take a look at how data & business process services stocks fared in Q1, starting with CoStar (NASDAQ:CSGP). A combination of increasing reliance on data and analytics across various industries and the desire for cost efficiency through outsourcing could mean that companies in this space gain. As functions such as payroll, HR, and credit risk assessment rely on more digitization, key players in the data & business process services industry could be increased demand. On the other hand, the sector faces headwinds from growing regulatory scrutiny on data privacy and security, with laws like GDPR and evolving U.S. regulations potentially limiting data collection and monetization strategies. Additionally, rising cyber threats pose risks to firms handling sensitive personal and financial information, creating outsized headline risk when things go wrong in this area. The 11 data & business process services stocks we track reported a satisfactory Q1. As a group, revenues beat analysts' consensus estimates by 1.3% while next quarter's revenue guidance was in line. Thankfully, share prices of the companies have been resilient as they are up 9.1% on average since the latest earnings results. With a research department that makes over 10,000 property updates daily to its 35-year-old database, CoStar Group (NASDAQ:CSGP) provides comprehensive real estate data, analytics, and online marketplaces for commercial and residential properties in the U.S. and U.K. CoStar reported revenues of $732.2 million, up 11.5% year on year. This print was in line with analysts' expectations, and overall, it was a strong quarter for the company with an impressive beat of analysts' EPS estimates and revenue guidance for next quarter meeting analysts' expectations. CoStar delivered the weakest full-year guidance update of the whole group. Unsurprisingly, the stock is down 1.9% since reporting and currently trades at $81. Is now the time to buy CoStar? Access our full analysis of the earnings results here, it's free. Powering billions of critical customer interactions annually, CSG Systems (NASDAQ:CSGS) provides cloud-based software platforms that help companies manage customer interactions, process payments, and monetize their services. CSG reported revenues of $299.5 million, up 1.5% year on year, outperforming analysts' expectations by 1.4%. The business had an exceptional quarter with full-year revenue guidance exceeding analysts' expectations and a solid beat of analysts' EPS estimates. CSG scored the highest full-year guidance raise among its peers. The market seems content with the results as the stock is up 4.4% since reporting. It currently trades at $64. Is now the time to buy CSG? Access our full analysis of the earnings results here, it's free. Processing over $10 trillion in equity and fixed income trades daily and managing proxy voting for over 800 million equity positions, Broadridge Financial Solutions (NYSE:BR) provides technology-driven solutions that power investing, governance, and communications for banks, broker-dealers, asset managers, and public companies. Broadridge reported revenues of $1.81 billion, up 4.9% year on year, falling short of analysts' expectations by 2.5%. It was a slower quarter, leaving some shareholders looking for more. Broadridge delivered the weakest performance against analyst estimates in the group. The stock is flat since the results and currently trades at $241.80. Read our full analysis of Broadridge's results here. Processing over 2.8 billion insurance transaction records annually through one of the world's largest private databases, Verisk Analytics (NASDAQ:VRSK) provides data, analytics, and technology solutions that help insurance companies assess risk, detect fraud, and make better business decisions. Verisk reported revenues of $753 million, up 7% year on year. This print was in line with analysts' expectations. More broadly, it was a mixed quarter as it also recorded a narrow beat of analysts' constant currency revenue estimates but a slight miss of analysts' full-year EPS guidance estimates. The stock is up 9.9% since reporting and currently trades at $325.42. Read our full, actionable report on Verisk here, it's free. Pioneering the concept of "agile aerospace" with hundreds of small but powerful satellites, Planet Labs (NYSE:PL) operates the world's largest fleet of Earth observation satellites, capturing daily images of our planet to provide insights on deforestation, agriculture, and climate change. Planet Labs reported revenues of $66.27 million, up 9.6% year on year. This result beat analysts' expectations by 6.5%. Overall, it was a very strong quarter as it also recorded an impressive beat of analysts' EPS estimates and full-year revenue guidance slightly topping analysts' expectations. Planet Labs achieved the biggest analyst estimates beat among its peers. The stock is up 38.4% since reporting and currently trades at $5.55. Read our full, actionable report on Planet Labs here, it's free. As a result of the Fed's rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed's 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump's victory in the U.S. Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain, leaving much uncertainty around 2025. Want to invest in winners with rock-solid fundamentals? Check out our 9 Best Market-Beating Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate. Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
