CoStar Group has far outpaced the record high returns of the S&P 500 over the past five years as they expand their market reach with new software and technology solutions. EBITDA has increased 86.6% over the past three years while revenues are up 21% year over year as 2020 marks record-high revenue growth for the company.
CoStar has the benefit of operating in a technology-driven environment, which right now is trending nowhere but up. Q3 2020 saw a 33% in traffic to its various platforms, and the company recently announced its plans to acquire Houses.com and HomeSnap, which will help expand reach, advertising sales, and revenues in the coming year. The challenge right now with CoStar is the share price, which is trading around $939 per share, making it an expensive real estate stock for many investors. The company also doesn't pay dividends, so investors purchasing shares are relying solely on future share-price appreciation. If the company is able to achieve a 15% annualized return, half of the return they've achieved over the past decade, investors who place $10,000 in the company today could turn that investment into a million in just over 32 years. If CoStar Group is able to maintain its decade annualized return of around 30%, investors could achieve millionaire status in just under 18 years. Right now, every sign points to CoStar group being a continued millionaire maker in the future, making it worthwhile investment for the patient investor.