Is CoStar Group, Inc. overvalued or undervalued?

As of 24 October 2025, the valuation grade for CoStar Group, Inc. has moved from fair to attractive, indicating a positive shift in its valuation outlook. The company appears to be overvalued, primarily reflected in its high P/E ratio of 283, compared to peers such as VeriSign, Inc. with a P/E of 33.05 and Check Point Software Technologies Ltd. at 53.34. Additionally, CoStar's EV to EBITDA stands at 202.31, significantly higher than the industry average, suggesting that its earnings potential is not aligned with its current valuation.
While CoStar's stock has shown a 5.38% return over the past year, it has underperformed compared to the S&P 500's 16.90% return in the same period, reinforcing the notion that the stock may be overvalued relative to broader market performance. Other notable ratios include an EV to Sales of 10.70 and a ROE of 1.37%, which further highlight the disparity between its valuation and financial performance compared to its peers.