Is CoStar Group, Inc. overvalued or undervalued?

As of 5 September 2025, the valuation grade for CoStar Group, Inc. has moved from attractive to fair. The company appears to be overvalued based on its current metrics, with a P/E ratio of 283, a Price to Book Value of 3.87, and an EV to EBITDA of 202.31. In comparison to peers, VeriSign, Inc. has a P/E of 33.05, while Check Point Software Technologies Ltd. shows a P/E of 53.34, indicating that CoStar Group's valuation is significantly higher than these comparable firms.
Despite a strong year-to-date return of 24.68%, which outperformed the S&P 500's 12.22%, the long-term performance shows a concerning trend, with a 5-year return of only 7.87% compared to the S&P 500's 96.61%. This suggests that while CoStar Group has had some recent success, its overall valuation does not align with its performance relative to the market and its peers.