CoStar Group Announces Public Offering of $750 Million of Common Stock
September 15, 2022
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Costar Intrinsic Value – COSTAR($NASDAQ:CSGP): In a move that will see it join the S&P 500 Index, CoStar Group has announced a public offering of $750 million of its common stock. The real estate data and analytics company will use the proceeds to help fund its growth initiatives, including investments in technology and product development. With the real estate market continuing to show strong growth potential, CoStar Group is well positioned to capitalize on this trend and continue its impressive run of growth.
Market Price
The stock opened at $74.7 and closed at $74.0, down 3.5% from the previous closing price of $76.6. The company plans to use the proceeds from the offering to repay debt and for general corporate purposes.
VI Analysis – Costar Intrinsic Value
An investment in COSTAR Group, Inc is an investment in the leading provider of commercial real estate information, analytics, and online marketplaces. The company’s fundamental strength reflects its long-term potential, and the below analysis on COSTAR is made simple by the VI app. The fair value of COSTAR shares is around $87.0, calculated by the VI Line. The current price of $74.0 represents a fair price that is undervalued by 15%.
Summary
J.P. Morgan Securities LLC and BofA Securities, Inc are acting as joint book-running managers for the offering. Evercore ISI and RBC Capital Markets are acting as lead managers for the offering. The stock price moved down the same day.
