Goldman Sachs reiterated a Buy rating and $105 price target on CoStar Group (NASDAQ:CSGP), highlighting growth potential in the U.S. residential real estate market.
The analysts said CoStar saw inefficiencies in current real estate portals, which focused on lead generation rather than property marketing. The company estimated the U.S. residential total addressable market at $3 billion, with potential EBITDA of $1.5 billion—two to three times larger than Apartments.com.
Residential bookings had remained strong, with 2,000–2,500 new memberships monthly since April. CoStar planned to adopt a tiered pricing model for Homes.com over time and expected residential spending to total about $900 million this year.
International expansion also continued, with the acquisition of Domain in Australia and investment in OnTheMarket in the UK. Meanwhile, CoStar Suite and Apartments.com remained resilient despite weakness in commercial real estate.
