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CoStar Group (CSGP) Snaps Up France-Based BureauxLocaux

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As part of its international expansion strategy, CoStar Group, Inc. (CSGP - Free Report) recently acquired COMREAL INFO, which owns BureauxLocaux.com. The acquisition complements the company’s earlier Europe-based acquisitions of Realla and Belbex.

BureauxLocaux is one of the leading property portals enagaged in buying and leasing of commercial real estate properties.

CoStar further added that France is one of the largest commercial property markets in Europe with an estimated annual investment transaction value hovering around €40 billion. The buyout of BureauxLocaux will help the company gain a strong foothold in the market.

BureauxLocaux boasts sale and lease listings of 60,000 and witnesses more than 425,000 visits to its website every month. The marketplace offers subscription-based commercial property listing platform and has an enviable customer base that includes more than 90% of France’s top commercial property brokers, added the company.

Since 2018, BureauxLocaux.com has registered 30% growth (on a compounded annual basis) in the traffic on its website. 

 

CoStar’s Acquisition Strategy to Boost Footprint

Acquisitions have helped CoStar  to enhance its presence in the domestic and international real estate verticals.

In May 2021, the company acquired residential property listing and marketing portal, Homes.com in an all-cash deal worth $156 million. In December 2020, the company acquired Homesnap Inc in an all-cash deal worth $250 million.

Headquartered in Bethesda, Homesnap provides applications and technology services to real estate agents.  With the Homesnap buyout, CoStar is looking to expand its addressable market in the U.S. residential real estate vertical.
In June 2020, management acquired Ten-X for $190 million that is an online auction platform for commercial real estate.

CoStar is also focused on expanding its presence in the international markets. Last year, the company acquired Germany-based Emporis for an undisclosed amount. Emporis is a commercial real estate data provider, which boasts 600,000 images in 100 countries along with 700,000 building records in its database, added CoStar.

Apart from that, CoStar’s acquisitions include ForRent.com, Apartment Finder, STR, Inc, Off Campus Partners, LLC, LoopNet and Apartments.com. LoopNet (in 2012 at a price of $860 million) and Apartments.com ( in 2014 for $585 million) are two of the biggest buyouts for CoStar.

In the last reported quarter, the company announced that Ten-X revenues soared 42% year over year on a pro-forma basis. The upside can be attributed to 31% growth in average deal size and a 35% increase in transaction volume. Revenues from Homesnap surged 50% on a year-over-year basis and the same from Loop Net increased 18% year over year.

Overall, the company’s revenues were up 21% to $480 million for the second quarter of 2021. CoStar witnessed a 47% increase in overall unique visitors on its platforms.

For the third quarter of 2021, the company expects overall revenue growth between $495 million to $500 million, indicating growth of 17% (at mid-point) from the year-ago quarter’s figure.

The Zacks Consensus Estimate for revenues is presently pegged at $497.96 billion, suggesting a rise of 17% on a year-over-year basis.

Zacks Rank and Key Picks

At present, CoStar carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader technology sector are Paycom Software (PAYC - Free Report) , HP Inc (HPQ - Free Report) and Avnet (AVT - Free Report) . All the stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term earnings growth rate for Paycom, HP Inc and Avnet is pegged at 25%, 8.2% and 25.4%, respectively.

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