CoStar CEO Buys $2.5M as Stock Sits 68% Below Highs
CoStar CEO Andrew Florance bought $2.49 million in shares while the stock sits 68% below prior highs. The company posted four consecutive consensus EPS beats, suggesting management conviction in the e
CoStar CEO Buys $2.5M as Stock Sits 68% Below Highs
NEW YORK, October 27 —
When Andrew Florance, founder and CEO of CoStar Group, Inc. (CSGP), spent $2.49 million buying shares at $29.89 apiece in early August, he was betting that the market had overshot on a business posting four consecutive earnings beats. The stock sits at $33.70, still 68% below prior highs, and that conviction remains unvalidated.
- Trailing revenue of $3.56 billion, up 18.4% year-over-year; gross margin 78.7%.
- Four consecutive consensus EPS beats, with positive surprises ranging from 10.5% to 27.1%.
- Net 90-day insider buying: $2.49 million purchased against $0.25 million sold; all buying from the CEO.
Execution Without Multiple Expansion
CoStar Group provides commercial real estate's data infrastructure: its CoStar Property, Leasing, Sales, and Tenant modules serve brokers, REITs, and asset managers across the United States, Europe, Asia Pacific, and Latin America, while Homes.com, Apartments.com, and LoopNet connect buyers, renters, and landlords across residential and commercial markets. Trailing revenue reached $3.56 billion, growing 18.4% year-over-year at a 78.7% gross margin, and EPS has beaten consensus in each of the last four quarters. That kind of unbroken consistency normally compresses a discount. Instead, analyst consensus holds a price target of $37.65 on a stock at $33.70, pricing in modest recovery rather than any return to prior peak valuations.
The Direction of Insider Capital
The Form 4 filings tell a lopsided story. On August 4, Florance bought 83,300 shares at $29.89, a $2.49 million open-market purchase. Within three days, Director John W. Hill sold 3,500 shares at $30.21 on August 5, and Chief Accounting Officer Cynthia Cammett Cann sold 4,788 shares at $30.78 on August 7, with both transactions totaling approximately $0.25 million combined. Net insider activity over the 90-day window ran ten-to-one in favor of buying; the lopsided scale is what makes the signal directional rather than a wash.
| Ticker | Mkt cap | Fwd P/E | 52-wk |
|---|---|---|---|
| CSGP | $13.7B | 19.0x | -56.9% |
| VRSK | $25.7B | 22.6x | -16.0% |
| CBRE | $35.4B | 13.9x | -23.7% |
| CPRT | $27.0B | 16.1x | -34.0% |
| TYL | $15.8B | 25.1x | -24.1% |
| CDW | $20.4B | 13.5x | +2.5% |
The Earnings Ramp Q3 Must Confirm
CoStar carries $1.27 billion in cash against $1.16 billion in debt, and generated $413 million in free cash flow over the trailing twelve months; the balance sheet is not the constraint. The re-rating question is whether earnings can grow fast enough to justify the forward multiple: a trailing GAAP EPS of $0.18 against a 19.0x forward P/E implies real acceleration ahead. Q3 results are the next checkpoint: does EPS extend past $0.32, the most recent quarterly print, and does guidance narrow the gap to prior valuations? Run the free CoStar Group, Inc. deep-dive for current numbers, or pressure-test the thesis with a DCF calculator.
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Frequently Asked Questions
Why did CoStar CEO buy $2.5M in shares?
CEO Andrew Florance spent $2.49 million buying shares at $29.89 in early August, betting on the company's strong fundamentals. CoStar has posted four consecutive consensus EPS beats with surprises ranging from 10.5% to 27.1%, suggesting management conviction in the earnings trajectory.
How much has CoStar stock declined from its highs?
CoStar stock sits at $33.70, which is 68% below prior highs. Analyst consensus holds a price target of $37.65, implying modest recovery rather than any return to prior peak valuations.
What business does CoStar operate?
CoStar Group provides commercial real estate data infrastructure through CoStar Property, Leasing, Sales, and Tenant modules serving brokers, REITs, and asset managers across the United States, Europe, Asia Pacific, and Latin America. The company also operates Homes.com, Apartments.com, and LoopNet for residential and commercial real estate transactions.
What are CoStar's key financial metrics?
Trailing revenue reached $3.56 billion, growing 18.4% year-over-year with a 78.7% gross margin. The company carries $1.27 billion in cash against $1.16 billion in debt, and generated $413 million in free cash flow over the trailing twelve months.
What's the next catalyst for CoStar stock?
Q3 earnings results are the key checkpoint to determine if CoStar can extend EPS past $0.32, the most recent quarterly print. The re-rating question is whether earnings can grow fast enough to justify the forward multiple and narrow the gap to prior valuations.
CoStar Group founder and CEO Andrew Florance put $2.49 million of personal capital into CSGP at $29.89 a share in early August — after the stock had already fallen approximately 68% from its prior highs. With third-quarter results approaching and the stock still far below that peak, the market has not yet validated his conviction.