CoStar Group (CSGP) AI Stock Analysis

Company Guidance

For the fourth quarter, CoStar expects revenue of $976 million to $996 million, up 10% at the midpoint, including commercial revenue of $490 million to $500 million, up 5% at the midpoint, and residential revenue of $486 million to $496 million, up 14%; adjusted EBITDA is expected at $275 million to $295 million, a 29% margin at the midpoint and more than 900 basis points above the fourth quarter of 2025, with commercial at $177 million to $187 million and residential at $98 million to $108 million. For the full year, revenue guidance is $3.75 billion to $3.77 billion, up 16% at the midpoint, with commercial revenue of $1.935 billion to $1.945 billion, up 9%, and residential revenue of $1.815 billion to $1.825 billion, up 25%; adjusted EBITDA guidance is $820 million to $840 million, representing a 22% margin, more than 800 basis points above 2025, and adjusted EPS guidance is $1.38 to $1.41 on 405 million weighted average shares. Zonda is expected to contribute approximately $60 million of revenue and $10 million of adjusted EBITDA in 2026 and to be accretive to adjusted EPS in its full year, while Vexcel is not included in guidance; the company expects to realize approximately $200 million of additional cost efficiency opportunities over the next 12 to 18 months, reaccelerate sales force growth in 2027, see sequential improvement in bookings in the fourth quarter, and remains committed to its adjusted EBITDA target of $1.25 billion in 2028.