CoStar Group (CSGP - Free Report) reported fourth-quarter 2022 non-GAAP earnings of 38 cents per share, beating the Zacks Consensus Estimate by 11.76% and increasing 8.6% year over year.
Revenues of $573.3 million beat the Zacks Consensus Estimate by 0.95% and increased 13.1% year over year.
Top-Line Details
CoStar revenues (38.2% of revenues) increased 15.1% year over year to $219.1 million. Apartments.com revenues increased 16% year over year to $198 million. Net new bookings jumped 177% year over year.
CoStar launched Apartments.com in Canada in the fourth quarter, marking the brand's first expansion outside the United States.
The company’s CoStar Lender product generated almost $6 million in net new sales and 140 new customers.
Information Services revenues (7.1% of revenues) increased 13.3% year over year to $40.7 million. Multifamily revenues (34.5% of revenues) increased 16.4% year over year to $198 million.
LoopNet revenues (10.7% of revenues) were up 12.1% year over year to $61.3 million.
Fourth-quarter residential revenues (2.8% of revenues) were $16.2 million, declining 21.6% year over year.
Other marketplace revenues (6.6% of revenues) increased 8.4% year over year to $38.1 million.
Operating Details
In the reported quarter, selling and marketing, and general and administrative expenses as a percentage of revenues increased 290 basis points (bps) and 230 bps, respectively, on a year-over-year basis.
Software development expenses as a percentage of revenues decreased 20 bps, whereas customer base amortization expenses decreased 150 bps.
The adjusted EBITDA margin in the fourth quarter of 2022 was 31.8%, contracting 640 bps year over year.
Balance Sheet and Cash Flow Statement
CoStar reported cash and cash equivalents of $4.97 billion as of Dec 31, 2022, compared with $4.78 billion as of Sep 30, 2022.
The company, however, had a long-term debt of $989.2 million as of Dec 31, 2022.
It generated $293.59 million in cash from operations compared with $293.6 million in the previous quarter.
Guidance
CoStar expects 2023 revenues between $2.46 billion and $2.48 billion, indicating revenue growth of 13% at the mid-point of this range. First-quarter 2023 revenues are expected between $575 million and $580 million, indicating year-over-year growth of 12% at the mid-point.
The company expects adjusted EBITDA of $500-$520 million. For the first quarter of 2023, CoStar expects adjusted EBITDA of $111-$116 million.
Earnings are expected between $1.06 and $1.09 per share for 2023. Moreover, earnings are expected between 25 and 26 cents per share for the first quarter.
Stocks to Consider
CoStar currently carries a Zacks Rank #3 (Hold).
CSGP shares have gained 20.8% against the Zacks Computer and Technology sector’s decline of 16.8% in the past year.
Baidu (BIDU - Free Report) , Everbridge (EVBG - Free Report) and Frontier (FYBR - Free Report) are some better-ranked stocks that investors can consider in the broader sector. All three stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Baidu shares have declined 7.1% in the past year. BIDU is set to report its fourth-quarter 2022 results on Feb 22.
Everbridge shares have declined 22.7% in the past year. EVBG is set to report its fourth-quarter 2022 results on Feb 22.
Frontier shares have gained 6.1% in the past year. FYBR is set to report its fourth-quarter 2022 results on Feb 24.
5 Stocks Set to Double
Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Today, See These 5 Potential Home Runs >>
CoStar Group (CSGP - Free Report) reported fourth-quarter 2022 non-GAAP earnings of 38 cents per share, beating the Zacks Consensus Estimate by 11.76% and increasing 8.6% year over year.
Revenues of $573.3 million beat the Zacks Consensus Estimate by 0.95% and increased 13.1% year over year.
Top-Line Details
CoStar revenues (38.2% of revenues) increased 15.1% year over year to $219.1 million. Apartments.com revenues increased 16% year over year to $198 million. Net new bookings jumped 177% year over year.
CoStar launched Apartments.com in Canada in the fourth quarter, marking the brand's first expansion outside the United States.
The company’s CoStar Lender product generated almost $6 million in net new sales and 140 new customers.
Information Services revenues (7.1% of revenues) increased 13.3% year over year to $40.7 million. Multifamily revenues (34.5% of revenues) increased 16.4% year over year to $198 million.
LoopNet revenues (10.7% of revenues) were up 12.1% year over year to $61.3 million.
Fourth-quarter residential revenues (2.8% of revenues) were $16.2 million, declining 21.6% year over year.
Other marketplace revenues (6.6% of revenues) increased 8.4% year over year to $38.1 million.
Operating Details
In the reported quarter, selling and marketing, and general and administrative expenses as a percentage of revenues increased 290 basis points (bps) and 230 bps, respectively, on a year-over-year basis.
Software development expenses as a percentage of revenues decreased 20 bps, whereas customer base amortization expenses decreased 150 bps.
The adjusted EBITDA margin in the fourth quarter of 2022 was 31.8%, contracting 640 bps year over year.
Balance Sheet and Cash Flow Statement
CoStar reported cash and cash equivalents of $4.97 billion as of Dec 31, 2022, compared with $4.78 billion as of Sep 30, 2022.
The company, however, had a long-term debt of $989.2 million as of Dec 31, 2022.
It generated $293.59 million in cash from operations compared with $293.6 million in the previous quarter.
Guidance
CoStar expects 2023 revenues between $2.46 billion and $2.48 billion, indicating revenue growth of 13% at the mid-point of this range. First-quarter 2023 revenues are expected between $575 million and $580 million, indicating year-over-year growth of 12% at the mid-point.
The company expects adjusted EBITDA of $500-$520 million. For the first quarter of 2023, CoStar expects adjusted EBITDA of $111-$116 million.
Earnings are expected between $1.06 and $1.09 per share for 2023. Moreover, earnings are expected between 25 and 26 cents per share for the first quarter.
Stocks to Consider
CoStar currently carries a Zacks Rank #3 (Hold).
CSGP shares have gained 20.8% against the Zacks Computer and Technology sector’s decline of 16.8% in the past year.
Baidu (BIDU - Free Report) , Everbridge (EVBG - Free Report) and Frontier (FYBR - Free Report) are some better-ranked stocks that investors can consider in the broader sector. All three stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Baidu shares have declined 7.1% in the past year. BIDU is set to report its fourth-quarter 2022 results on Feb 22.
Everbridge shares have declined 22.7% in the past year. EVBG is set to report its fourth-quarter 2022 results on Feb 22.
Frontier shares have gained 6.1% in the past year. FYBR is set to report its fourth-quarter 2022 results on Feb 24.
5 Stocks Set to Double
Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Today, See These 5 Potential Home Runs >>
Get the latest research report on BIDU - FREE
Get the latest research report on CSGP - FREE
Get the latest research report on EVBG - FREE
Get the latest research report on FYBR - FREE