CoStar Group's stock tumbled 5.29% in after-hours trading on Tuesday, following the release of its fourth-quarter earnings and a significant analyst price target adjustment.
The real estate analytics firm reported quarterly results that presented a mixed picture. While CoStar's Q4 adjusted earnings per share of $0.31 surpassed the consensus estimate of $0.27, and revenue of $900 million beat expectations of $886 million, its GAAP EPS of $0.11 fell short of the prior year's result of $0.15 per share.
The downward move was likely accelerated by investment firm Stephens, which sharply reduced its price target on CoStar to $70 from $105, while maintaining an Overweight rating. Analyst commentary highlighted concerns over valuation, noting the stock's price-to-earnings ratio had compressed to 36 times next 12-month earnings from 53 three months ago, despite the company affirming its full-year revenue guidance.
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