CoStar Group, Inc. (NASDAQ:CSGP)

CAPS Rating: 2 out of 5

Provider of information services to the commercial real estate industry in the United States and United Kingdom. Its integrated suite of products offers customers online access to a database of commercial real estate information.

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Member Avatar thumbsUpFool (98.33) Submitted: 3/12/2015 11:18:08 PM : Underperform Start Price: $192.50 CSGP Score: +0.54

I am not a naysayer or a doomsday predictor. This market is in new territory though, and it WILL come down sooner, rather than later. There are two strong predictors of serious crashes and those are the Shiller PE (CAPE) and Warren Buffet's favorite Mkt Cap to GNP. The CAPE goes back further, so let's look at that. There have only been three times before now that the CAPE (price to last 10 yr avg earnings or "Cyclically Adjusted PE) has soared past 25x. The Great Depression, The Dot Com boom, and the Housing Boom. All three times the market plummeted back down. The average 3 yr annualized return following these peaks averages about -19%. High PE and negative PE stocks will be absolutely obliterated, and this is one of those. I am calculating based on historical averages that the likelihood the crash has already begun is 27%. It's still more in the markets favor than not that the climb will continue, but each month that passes will eventually tip that in the other direction. So where are we going? I don't know, I can only go on history, and history does not always repeat itself exactly the same way. I do know though that I have made many successful stock picks based on books I've read and my personal experiences. History was the sole basis of every one of these books and every one of the decisions I made...When will the drop occur? Again, I don't know, I can only guess based on the averages of the amount of time it has taken in the past. In the Great Depression, after the CAPE reached 25, the crash happened within approx 300 days. The market during the dotcom and housing booms started its decline more than 4 years after reaching 25x. It will most likely be somewhere in between but this is one of only 4 data points so many outcomes are possible. I'm thumbsupfool, why the hell am I giving a thumbs down? Because this is a seriously overvalued time. One of the greatest in US market history.

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Member Avatar TMFInnovator (75.33) Submitted: 9/24/2014 2:39:52 PM : Outperform Start Price: $158.22 CSGP Score: +17.35

Wow...what a competitive advantage!

- SCALE: Massive scale advantages and a huge database of RE properties.
- NETWORK: Each new listing makes CoStar's database better. LoopNet and Apartments.com acquisitions just make them even stronger.
- SWITCHING COSTS: Once on the network, why would brokers leave to use less-complete data?

All of the big customers are already entrenched, the company is pulling in 20% cash flow margins, and the co-founders remain as Chairman and CEO. The shares are never 'cheap', but the pullback this year might be an opportunity.

Outperform.

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Member Avatar TerryHoodSr (78.17) Submitted: 4/24/2014 10:27:52 AM : Outperform Start Price: $167.52 CSGP Score: +6.37

CSGP 1yr EPS 26% 5yr 20%

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Member Avatar Voxer (< 20) Submitted: 9/15/2013 12:19:50 AM : Outperform Start Price: $169.65 CSGP Score: -5.77

Already well above the S&P, CoStar is actively expanding in the US and UK. Its information is being used by almost every major commercial real estate company. It's a back-end company and on the forefront of technology, two components I really like in a stock. Morningstar says it's overvalued, but folks have been saying that about Tesla for months (I really hope that comment doesn't come back to bite me!).

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Member Avatar pcarsten (95.41) Submitted: 2/9/2012 10:03:51 AM : Outperform Start Price: $58.07 CSGP Score: +183.96

As long as the LoopNet merger goes through they should be performing quite well

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Member Avatar 1HumblePie (< 20) Submitted: 6/24/2009 7:13:11 PM : Underperform Start Price: $38.37 CSGP Score: -278.52

Costar, a stock that is overvalued, with a software that is overvalued, in a commercial real estate market that is overvalued....well, you get the point.

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Member Avatar trendsJohn (< 20) Submitted: 6/14/2008 3:05:46 PM : Outperform Start Price: $49.16 CSGP Score: +241.04

multiple technical positive signals (contrary)

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Member Avatar pjani06 (28.90) Submitted: 4/16/2008 1:45:16 AM : Underperform Start Price: $45.50 CSGP Score: -270.29

Two part play in an industry that may be ripe for competition.
Short CSGP and Long LOOP on valuation measures.

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Member Avatar STNL (61.30) Submitted: 11/10/2007 2:13:55 PM : Underperform Start Price: $53.89 CSGP Score: -214.18

COSTAR is not reliable and doesn't encompass nearly enough of what I need. They most lkiely maxed out their customer base. The white-hot real estate boom, which produced more newbie real estate experts than dots, in dot-bombs is now over. The real estate industry is in contraction. Forward projections based on their discretionary products are ... lets just say Foolish.

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Member Avatar cbbam (< 20) Submitted: 2/26/2007 8:59:46 AM : Underperform Start Price: $50.90 CSGP Score: -234.25

Forward PEG of 100. For 2007 revenue growth is slowing, net income is shrinking, margins are deteriorating. Residential housing woes are starting to seep into the commercial and retail markets.

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