Jefferies Upgrades CoStar Group to Buy, Foresees EBITDA Tripling to $2.4 B by 2030
Jefferies upgraded CoStar Group to Buy from Hold while reducing its price target to $67 from $84, citing sideways stock performance over the past five years and increased activist investor focus. The firm projects adjusted EBITDA will triple to $2.4 billion by 2030 with margins expanding to 36%.
1. Upgrade to Buy with Lower Price Target
On February 20, Jefferies moved CoStar Group from Hold to Buy while lowering its price target to $67 from $84, highlighting Homes.com debate as a compelling entry point following extended sideways share movement.
2. Activist Pressure and Share Performance
The presence of activist investors has heightened CoStar’s focus on execution, and the stock has traded flat over the past five years during the company’s largest investment phase to build new businesses.
3. Long-Term EBITDA Growth Forecast
Jefferies expects CoStar's adjusted EBITDA to increase from current levels to $2.4 billion by 2030, with operating margins expanding to 36%, reflecting anticipated efficiency gains and stronger profitability.
4. Retail Market Outlook Unchanged
CoStar’s February forecast maintains US retail vacancy near a 4.4% peak, anticipates increased store closures in early 2026, and projects full-year net absorption of just over 16 million square feet, marking one of the weakest years in the past decade.