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CoStar Group (CSGP) Q2 Earnings Beat, Revenues Increase Y/Y
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CoStar Group (CSGP - Free Report) reported second-quarter 2020 adjusted earnings of $2.34 per share that beat the Zacks Consensus Estimate by 14.7%. The figure climbed 4.9% year over year.
Revenues of $397.2 million outpaced the Zacks Consensus Estimate by 1.8% and improved 15.5% year over year.
North America revenues were $384.4 million, up 14.9% year over year. Moreover, international revenues were $12.8 million, up 39.1% year over year.
Markedly, CoStar had 62 million monthly unique visitors on its platforms in the quarter under review, up 13% sequentially.
Quarter Details
Information and analytics revenues were $195.6 million, up 12.7% year over year.
CoStar Suite revenues increased 8% year over year to $165.1 million. Information services revenues surged 47% from the year-ago quarter to $30.5 million.
CoStar Group, Inc. Price, Consensus and EPS Surprise
Online Marketplaces revenues increased 18.5% year over year to $201.6 million. Apartments.com grew 21% and LoopNet grew 18% year over year in the second quarter.
Management stated that traffic to Apartments.com and LoopNet marketplaces exceeded pre-coronavirus levels in the reported quarter. Per ComScore, Apartments attracted 23 million average monthly unique visitors, up 6% year over year, and 200 million visits, up 16%.
Multi-family revenues increased 20.8% year over year to $145.5 million. Commercial property and land revenues were $56 million, up 12.8%.
Operating Details
Gross margin expanded 230 basis points (bps) on a year-over-year basis to 81.4%.
Adjusted EBITDA margin of 32.4% expanded 40 bps on a year-over-year basis.
Selling and marketing expenses as a percentage of revenues declined 180 bps from the year-ago quarter to 32.8%.
General and administrative expenses as a percentage of revenues increased 210 bps on a year-over-year basis to 14.5%.
Non-GAAP operating margin contracted 130 bps on a year-over-year basis to 20.5%.
Balance Sheet
As of Jun 30, CoStar’s cash and cash equivalents (and total marketable securities) were $3.54 billion.
CoStar had long term debt of $745 million as of Jun 30.
Guidance
For the third quarter of 2020, revenues are expected between $415 million and $420 million, suggesting growth of 18% year over year at mid-point. Adjusted EBITDA is expected in the range of $120-$125 million.
The Zacks Consensus Estimate for revenues is currently pegged at $389.5 million, which indicates growth of 10.4% from the year-ago quarter’s reported figure.
Non-GAAP earnings are expected between $2 and $2.10 per share. The consensus mark is pegged at $2.28 per share, implying a decline of 12.6% from the year-ago quarter’s reported figure.
CoStar reinstated its 2020 guidance. The company currently expects revenues between $1.63 billion and $1.64 billion, suggesting growth of 1% year over year.
The Zacks Consensus Estimate for revenues is currently pegged at $1.58 billion, which indicates growth of 13% from the year-ago quarter’s reported figure.
Ten-X acquisition, completed in second-quarter 2020, is expected to contribute $25-$30 million in revenues.
Adjusted EBITDA is expected in the range of $515-$525 million for 2020, indicating 3% growth at the midpoint of the range compared with 2019.
Non-GAAP earnings are expected between $9.22 and $9.42 per share. The Zacks Consensus Estimate is pegged at $9.24 per share, implying a decline of 9.3% from the year-ago quarter’s reported figure.
Both Dropbox and Everbridge are scheduled to report earnings on Aug 6. Analog Devices is set to release quarterly results on Aug 19.
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CoStar Group (CSGP) Q2 Earnings Beat, Revenues Increase Y/Y
CoStar Group (CSGP - Free Report) reported second-quarter 2020 adjusted earnings of $2.34 per share that beat the Zacks Consensus Estimate by 14.7%. The figure climbed 4.9% year over year.
Revenues of $397.2 million outpaced the Zacks Consensus Estimate by 1.8% and improved 15.5% year over year.
North America revenues were $384.4 million, up 14.9% year over year. Moreover, international revenues were $12.8 million, up 39.1% year over year.
Markedly, CoStar had 62 million monthly unique visitors on its platforms in the quarter under review, up 13% sequentially.
Quarter Details
Information and analytics revenues were $195.6 million, up 12.7% year over year.
CoStar Suite revenues increased 8% year over year to $165.1 million. Information services revenues surged 47% from the year-ago quarter to $30.5 million.
CoStar Group, Inc. Price, Consensus and EPS Surprise
CoStar Group, Inc. price-consensus-eps-surprise-chart | CoStar Group, Inc. Quote
Online Marketplaces revenues increased 18.5% year over year to $201.6 million. Apartments.com grew 21% and LoopNet grew 18% year over year in the second quarter.
Management stated that traffic to Apartments.com and LoopNet marketplaces exceeded pre-coronavirus levels in the reported quarter. Per ComScore, Apartments attracted 23 million average monthly unique visitors, up 6% year over year, and 200 million visits, up 16%.
Multi-family revenues increased 20.8% year over year to $145.5 million. Commercial property and land revenues were $56 million, up 12.8%.
Operating Details
Gross margin expanded 230 basis points (bps) on a year-over-year basis to 81.4%.
Adjusted EBITDA margin of 32.4% expanded 40 bps on a year-over-year basis.
Selling and marketing expenses as a percentage of revenues declined 180 bps from the year-ago quarter to 32.8%.
General and administrative expenses as a percentage of revenues increased 210 bps on a year-over-year basis to 14.5%.
Non-GAAP operating margin contracted 130 bps on a year-over-year basis to 20.5%.
Balance Sheet
As of Jun 30, CoStar’s cash and cash equivalents (and total marketable securities) were $3.54 billion.
CoStar had long term debt of $745 million as of Jun 30.
Guidance
For the third quarter of 2020, revenues are expected between $415 million and $420 million, suggesting growth of 18% year over year at mid-point. Adjusted EBITDA is expected in the range of $120-$125 million.
The Zacks Consensus Estimate for revenues is currently pegged at $389.5 million, which indicates growth of 10.4% from the year-ago quarter’s reported figure.
Non-GAAP earnings are expected between $2 and $2.10 per share. The consensus mark is pegged at $2.28 per share, implying a decline of 12.6% from the year-ago quarter’s reported figure.
CoStar reinstated its 2020 guidance. The company currently expects revenues between $1.63 billion and $1.64 billion, suggesting growth of 1% year over year.
The Zacks Consensus Estimate for revenues is currently pegged at $1.58 billion, which indicates growth of 13% from the year-ago quarter’s reported figure.
Ten-X acquisition, completed in second-quarter 2020, is expected to contribute $25-$30 million in revenues.
Adjusted EBITDA is expected in the range of $515-$525 million for 2020, indicating 3% growth at the midpoint of the range compared with 2019.
Non-GAAP earnings are expected between $9.22 and $9.42 per share. The Zacks Consensus Estimate is pegged at $9.24 per share, implying a decline of 9.3% from the year-ago quarter’s reported figure.
Zacks Rank & Stocks to Consider
Currently, CoStar carries a Zacks Rank #4 (Sell).
Some better-ranked stocks in the broader technology sector are Dropbox (DBX - Free Report) , Everbridge (EVBG - Free Report) and Analog Devices (ADI - Free Report) . All the three stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Both Dropbox and Everbridge are scheduled to report earnings on Aug 6. Analog Devices is set to release quarterly results on Aug 19.
Today's Best Stocks from Zacks
Would you like to see the updated picks from our best market-beating strategies? From 2017 through 2019, while the S&P 500 gained an impressive +53.6%, five of our strategies returned +65.8%, +97.1%, +118.0%, +175.7% and even +186.7%.
This outperformance has not just been a recent phenomenon. From 2000 – 2019, while the S&P averaged +6.0% per year, our top strategies averaged up to +54.7% per year.
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